Facts of the Case. An association’s architectural committee approved, with certain conditions, an owners’ plans to remodel and expand their home. The owners subsequently decided to move the location of the garage, and submitted modified plans to the committee. 
The committee denied approval of the modified plans. The owners agreed to correct the committee’s objections to the new garage, while noting that they would begin construction only on those areas unrelated to the garage based upon the originally approved plans.
After construction began, the association ordered the owners to immediately stop all work. The association claimed that its original approval was not final since all of the stated conditions had never been met. Therefore, according to the association, the owners had no right to begin construction.
Questions for the Court to Decide. Was the architectural committee’s “conditional approval” of the owners’ original plans final and binding? Did the association have the right to stop the owners from beginning their construction?
Ruling of the Court. In the unpublished California Court of Appeal case of Brutocao v The Hunt Club Community Association (decided February 29, 2008), the court ruled that the committee’s conditional approval of the original plans was final and binding, and therefore the association had improperly stopped the owners from beginning construction.
The court explained that even though the committee’s original approval contained conditions, it was nevertheless final and binding because the committee did not specifically state that any of the listed conditions had to be performed before the owners could begin construction. Thus, the owners could comply with the conditions after they began construction, and the association’s order to stop work was improper.
Furthermore, the court noted that the association’s governing documents did not provide for the automatic invalidation of approved plans which were subsequently modified by an owner.
Large Damages Awarded. The trial court ordered the association to pay the owners’ increased construction costs in the amount of $163,078, plus reimbursement of the owners’ attorney’s fees of $176,976.75 and court costs of $17,976.75.
Recommendations. If the association wants an owner to satisfy certain conditions before construction can begin on a proposed remodel, the association should specifically and unequivocally so advise the owner in writing. In such a situation (and depending, of course, on the governing document provisions), instead of “conditionally approving” the application, it is generally better for the association to formally deny the application, list the reasons for the denial, and advise the owner to submit a new application with revised plans.