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KAUFMAN DOLOWICH & VOLUCK, LLP
A. Jeanne Grove (SBN 232312)
Morgan Cahill-Marsland (SBN 309903)
425 California Street, Suite 2100
San Francisco, CA 94104
Telephone: (415) 926-7600
Facsimile: (415) 926-7601
Email: jgrove@kdvlaw.com
Attorneys for Plaintiffs
MARK D. MCHALE and MICHAEL J. GRANT
SUPERIOR COURT OF CALIFORNIA COUNTY OF
SAN FRANCISCO CGC-21-592767
MARK D. MCHALE, an individual; Case No.
MICHAEL J. GRANT, an individual,
PLAINTIFFS MARK D. MCHALE AND
MICHAEL J. GRANT’S COMPLAINT FOR:
Plaintiffs,
y 1, BREACH OF GOVERNING
. DOCUMENTS;
WILLIAM RICHARD LAWSON, an 2, BREACH OF CONTRACT;
3. VIOLATION OF THE DAVIS-
individual, and DOES 1-50, inclusive,
STIRLING COMMON INTEREST
DEVELOPMENT ACT, CIVIL
Defendants. CODE § 4000, ez. seq.;
NEGLIGENCE;
DECLARATORY RELIEF;
NUISANCE;
CONVERSION; AND
RIGHT TO FORECLOSURE —
REAL PROPERTY CLAIM
SAAN S
Plaintiffs MARK D. MCHALE and MICHAEL J. GRANT (“Plaintiffs”) alleges, as follow:
THE PARTIES
1. Plaintiffs MARK D. MCHALE and MICHAEL J. GRANT are individuals over the
age of 18 residing in San Francisco, California, and are the current owner of a condominium unit
located at 221 Eureka, San Francisco, California (“221 Eureka”) 221 Eureka is one unit of a two-unit
PLAINTIFFS MARK D. MCHALE AND MICHAEL J. GRANT’S COMPLAINThomeowners’ association located at 219-221 Eureka Street, San Francisco, California (the “Eureka
Property”).
2. On information and belief, Defendant William Richard Lawson is an individual over
the age of 18 residing in San Francisco and the current record owner of 219 Eureka, San Francisco,
California (“219 Eureka”), the second unit in the Eureka Property.
3. On information and belief, the Eureka Property is governed by 219-221 Eureka Street
Homeowners’ Association, an unincorporated association, (the “HOA”), which, at all times herein
mentioned, is a common interest development with its principal place of business within the City and
County of San Francisco.
4. On information and belief, the HOA is govemed by a Declaration of Restrictions and
Condominium Plan (the "CC&Rs") and the Bylaws of the 219-221 Eureka Street Homeowners’
Association (the “Bylaws”) collectively the “Governing Documents”. A copy of the CC&Rs is
attached as Exhibit 1. A copy of the Bylaws is attached as Exhibit 2.
5. The true names and capacities, whether individual, corporate, associate, or otherwise
of DOES 1 through 50, inclusive, are unknown to Plaintiffs, who therefore sue said defendants by
such fictitious names. Plaintiffs will move to amend this Complaint to show such defendants’ true
names and capacities when the same have been ascertained. Plaintiffs further believe, and thereupon
alleges, that each of the fictitiously named defendants is in some manner, means, or degree
connected with the matters herein alleged and is liable to Plaintiffs thereon.
GENERAL ALLEGATIONS
6. Section 12.1 of the CC&Rs states, “[t]he Association, or any Owner may enforce the
Governing Documents. An Owner or the Association may enforce the Governing Documents by
legal action. [...].”
7. Defendant, by virtue of his ownership of 219 Eureka Street, is a member of the HOA,
pursuant to Section 3.2 of the CC&Rs.
8. Plaintiffs purchased 221 Eureka Street on or about October 2015 as their principal
place of residence and are also members of the HOA by virtue of their ownership of 221 Eureka
Street.
PLAINTIFFS MARK D. MCHALE AND MICHAEL J. GRANT’S COMPLAINTwn
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9. For years, Plaintiffs have attempted to addressed necessary repair and maintenance
projects in the building, which the HOA is required to perform. The outstanding issues include, but
are not limited to, painting the building, active termites/damage, and rear stair damage.
10. Plaintiffs have participated in mediation on several occasions with Defendants over
the past several years without success. Defendants did at one point in March 2019 agree to paint the
building and also address common area pest damage as part of the painting project. But thereafter,
Defendants refused to move forward with the work.
11. Defendant has flatly refused to perform almost any building maintenance in the last
five (5) years. In the meantime, the Eureka Property has continued to deteriorate without proper
maintenance.
12. Inor about September 2020, Plaintiffs obtained multiple bids, at their sole cost, for
maintenance including roof repair, which included work in the lightwell; repairing the pest and dry
rot issues; and the back stairs repair. Defendant failed to respond to the proposed bids or Plaintiff's
requests to repair the Eureka Property.
13. Inor around April 2021, Plaintiffs retained Kevin Kearney (“Kearney”) of Kearney
and O’Banion, a licensed contracting company, to conduct an inspection of the Eureka Property and
paid-a $5,000 retainer. On April 12, 2021, Kearney inspected the Eureka Property and issued a life
safety warning because of the state of the rear stairs of the Eureka Property. Kearney informed the
Plaintiffs that the area should be blocked off with caution tape and no one should use the stairs at all.
Plaintiffs blocked off the stairs and informed Defendant of the serious state of the stairs and that no
one should use the stairs.
14. On information and belief, Defendant disregarded Kearney’s warning and removed
the caution tape and has resumed use of the dangerous rear stairs. Plaintiffs are further informed and
believe that Defendant has also allowed guests and invitees to use the dangerous stairs.
15. Defendant agreed that the HOA (Plaintiffs and Defendant) should retain Plaintiffs’
construction consultant Kearney to oversee the repairs of the Eureka Property. Kearney issued a
consulting agreement for the HOA on May 6, 2021 and began work on behalf of the HOA at that
time. Plaintiffs paid the retainer amount in the amount of $5,000 on behalf of the HOA.
PLAINTIFFS MARK D. MCHALE AND MICHAEL J. GRANT’S COMPLAINT16. | To date, Defendant has not paid for his portion of Kearney’s retainer or any of the
amounts that the HOA owes Kearney for Kearney’s work on the Eureka Property to date.
17. Plaintiffs have paid all sums owed to Kearney and are therefore owed a
reimbursement from the Defendant.
18. The total estimated costs of the repairs will be at least $180,000. Plaintiffs have paid
a portion of these repair costs on behalf of the HOA and will be covering these costs, until
Defendant pays his 51.8% share of the costs, as required under the CC&Rs.
FIRST CAUSE OF ACTION
(Breach of Governing Documents)
19. Plaintiffs reassert and re-allege paragraphs 1 through 18 of this Complaint as though
fully set forth herein.
20. As set forth above, 219-221 Eureka Street is governed by the Governing Documents
attached as Exhibit 1. Pursuant to the Davis-Stirling Act, the declaration of covenants and restrictions
governing a common interest development are enforceable as equitable servitudes and “shall insure to
the benefit of and bind all owners of separate interests in the development.” The owner of a separate
interest may enforce the declaration and governing documents.
21. As set forth above, the Defendant has committed multiple breaches of the Governing
Documents. To date, Defendant has refused in bad faith to repair and maintain the common area roof
and lightwell, remediate the wood destroying pest, remediate the dry rot, repair the dangerous and
decaying rear stairs, subjecting the Eureka Property to significant damage. The Association has a duty
to maintain the common areas and should have promptly made the necessary repairs when it was first
made aware of the issues years ago.
22. Plaintiffs have performed all of their obligations legally required of them under the
Governing Documents.
23. As a proximate result of the Defendant’s breaches as herein alleged, Plaintiffs have
been harmed in an amount to be proven at trial in excess of the jurisdiction of this court.
24. In addition, because Plaintiffs have no adequate remedy at law for the future injuries
that are threatened, Defendant should be ordered to immediately address the rear stairs and repair the
PLAINTIFFS MARK D. MCHALE AND MICHAEL J. GRANT’S COMPLAINTdamage caused to avoid injury to the individuals who use the stairs.
SECOND CAUSE OF ACTION
(Breach of Contract)
25. Plaintiffs incorporate herein by reference the allegations set forth in paragraphs 1
through 24 above as though fully stated herein.
26. As set forth above, the Association, including all of its members, is governed by the
Governing Documents attached as Exhibit 1.
27. Asset forth above, the Defendant breached the Governing Documents. The Defendant
has refused in bad faith to repair and maintain the common area roof and lightwell, remediate the wood
destroying pest, remediate the dry rot, repair the dangerous and decaying rear stairs, subjecting the
Eureka Property to significant damage.
28. Plaintiffs have performed all obligations legally required of them under the Governing
Documents.
29. As a proximate result of Defendant’s breach as alleged herein, Plaintiffs have been
harmed in an amount to be proven at trial in excess of the jurisdiction of this Court.
30. In addition, because Plaintiffs have no adequate remedy at law for the future injuries
that are threatened, Defendant should be ordered to immediately address the rear stairs and repair the
damage caused to avoid injury to the individuals who use the stairs.
THIRD CAUSE OF ACTION
(Violation of the Davis-Stirling Act Common Interest Development Act,
Civil Code § 4000 et seq.)
31. Plaintiffs incorporate herein by reference the allegations set forth in paragraphs 1
through 30 above as though fully stated herein.
32. Asset forth above, the Defendant violated the Davis-Stirling Act in multiple respects.
Civil Code Section 4775 provides that the HOA, and therefore its members, is responsible for
repairing, replacing, and maintaining the common areas of the Eureka Property. The roof, lightwell,
building exterior, and rear stairs are common areas and must be maintained by the HOA. See Section
8.2 (A) and 8.2 (B) of the CC&Rs.
PLAINTIFFS MARK D. MCHALE AND MICHAEL J. GRANT’S COMPLAINT33. To date, Defendant has refused in bad faith to maintain and repair or even adequately
investigate the damage to the roof, lightwell, building exterior, and rear stairs.
34. Asa proximate result of Defendant’s violations of law, Plaintiffs have been harmed in
an amount to be proven at trial in excess of the jurisdiction of this Court.
35. In addition, because Plaintiffs have no adequate remedy at law for the future injuries
that are threatened, Defendant should be ordered to immediately address the dangerous rear stairs and
repair the damage to avoid injury to the Parties.
36. Civil Code Section 4775 provides that the Association is responsible for repairing,
replacing, and maintaining the common area of the Property.
37. Plaintiffs have performed all of their obligations as members of the Association legally
required of them under Davis-Stirling Act.
38. As a proximate result of Defendants’ violations of the Davis-Stirling Act, Plaintiffs
have been damaged in an amount according to proof.
FOURTH CAUSE OF ACTION
(Negligence)
39. Plaintiffs incorporate herein by reference the allegations set forth in paragraphs 1
through 38 above as though fully stated herein.
40. Defendant, a HOA member, owes a duty of ordinary care to the other
members/shareholders, Plaintiffs, to perform the duties of the HOA in good faith, in a manner that is
in the best interest of the HOA, and with such care as an ordinary prudent person in a like position
would use in similar circumstances, including reasonable inquiry. Defendant also owes a duty to its
members, including the Plaintiffs, to be familiar with and fulfill the obligations under the law and the
Governing Documents. Defendant also owes a duty to other members, including the Plaintiffs, to
maintain the common areas of the property in a reasonable manner to prevent injury to third persons
and their property.
41. As set forth above, Defendant, failed to know and obey the laws and the Governing
Documents by failing to promptly investigate and repair the damage to the Eureka Property, thereby
causing unnecessary damage to the Eureka Property, and failing to maintain the common area to
PLAINTIFFS MARK D. MCHALE AND MICHAEL J. GRANT’S COMPLAINTwn
prevent damage.
42. Asa proximate result of the Defendant’s negligence as alleged herein, Plaintiffs have
been harmed in an amount to be proven at trial in excess of the jurisdiction of this Court.
FIFTH CAUSE OF ACTION
(Declaratory Relief)
43. Plaintiffs incorporates herein by reference the allegations set forth in paragraphs 1
through 42 above as though fully stated herein.
51. An actual controversy has arisen and now exists between Plaintiffs, on the one hand,
and Defendant, on the other hand, concerning (1) necessary common areas maintenance and repair of
the common area roof, the common area lightwell, the common area building exterior, and the
common area rear stairs, (2) the proper scope of work to repair the common area roof, the common
area lightwell, the common area building exterior, and the common area rear stairs, and (3) the
procedure, scope, and necessity of repair work for the rear stairs; and (4) the cost of the necessary
scope of repairs.
52. With respect to the first issue, Plaintiffs contends that the HOA must immediately agree
to repair the common area roof, the common area lightwell, the common area building exterior, and
the common area rear stairs so as to prevent any further damage to the Eureka Property.
53. With respect to the second issue, Plaintiffs contends that the HOA must
immediately repair the common area roof, the common area lightwell, the common area building
exterior, and common area rear stairs in accordance with the bids for repairs obtained by
Plaintiffs.
54. With respect to the third issue, Plaintiffs contends that the HOA must immediately
retain a structural engineer and general contractor to completely rebuild and replace the common
area rear stars with proper plans and permitting.
55. With respect to the fourth issue, Plaintiffs contends that the cost of the necessary
scope of repairs must be apportioned pursuant to Section 4.7 of the CC&Rs.
56. Defendant is expected to refute these contentions and therefore an actual
controversy exists between Plaintiffs and Defendant. Plaintiffs request declaratory judgment as
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follows: (1) Defendant must agree to the necessary common area maintenance, (2) Defendant
must agree to immediately repair the common area roof, the common area lightwell, the common
area building exterior, and common area rear stairs in accordance with the bids for repairs
obtained by Plaintiffs; (3) Defendant must agree to immediately retain a structural engineer and
general contractor to completely rebuild and replace the common area rear stars with proper plans
and permitting; (4) Defendant must pay for his proportional share of all repair expenses per
Section 4.7 of the CC&Rs.
SIXTH CAUSE OF ACTION
(Nuisance)
57. Plaintiffs incorporate herein by reference the allegations set forth in paragraphs 1
through 56 above, as though fully stated herein.
58. Civil Code section 3479 defines a nuisance as: "Anything which is injurious to
health, including, but not limited to, the illegal sale of controlled substances, or is indecent or
offensive to the senses, or an obstruction to the free use of property, so as to interfere with the
comfortable enjoyment of life or property."
59. Asset forth above, Defendants has refused to pay for and conduct basic
maintenance to the Eureka Property causing it to fall into disrepair. The damage to the Eureka
Property poses a life and safety risk to all the parties as well as any invitees.
60. Defendants refuses to repair the damage to the Eureka Property which has caused
parts of the Eureka Property, including but not limited to the rear stairs, to be unusable and
extremely dangerous.
61. | The Defendant’s conduct in failing to act and maintain the Eureka Property was
intentional and unreasonable, the condition that Defendant created and permitted to exist was the
result of an abnormally dangerous activity.
62. Asaresult of Defendant’s refusal to repair and maintain the Eureka Property,
Plaintiffs have been harmed as they have been unable to use the Eureka Property which directly
interferes with their comfortable enjoyment of the Eureka Property.
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SEVENTH CAUSE OF ACTION
(Conversion)
63. Plaintiffs incorporate herein by reference the allegations set forth in paragraphs 1
through 62 above, as though fully stated herein.
64. As stated above, the HOA agreed to retain the service of Kearney to oversee the
repairs for the Eureka Property. Plaintiffs transferred their initial retainer of $5,000 to the HOA’s
account with Kearney and have since paid Kearney’s monthly fees separately from the retainer
payment.
65. Plaintiffs are entitled to reimbursement from Defendant for his portion of
Kearney’s retainer as well as his portion of Kearney’s monthly cost as the fees are HOA fees and
not the sole responsibility of the Plaintiffs.
66. Pursuant to Section 4.7 of the CC&Rs which states, “The expenses for regular
assessments are payable 51.8% by the Owner of Unit 219 and 48.2% by the Owner of Unit 221.
Special assessments are divided between the Owners on the same basis as regular assessments.”
67. Defendant has intentionally and substantially interfered with Plaintiffs’ right to be
reimbursed for the sum by completely ignoring requests for reimbursement, and knowingly
withholding the funds from the Plaintiffs.
68. | On information and belief, Defendant has misappropriated the funds for his own
personal use.
69. Plaintiffs did not consent in any manner to Defendants taking the funds at issue for
their benefit.
70. Defendants’ misappropriation of the money he owes Plaintiffs for his own benefit
was a substantial factor in causing Plaintiffs’ harm.
71. Plaintiffs have been damaged in an amount to be proven at trial as a result of
Defendants’ actions in converting and misappropriating the insurance proceeds.
72. — Inaddition, because Plaintiffs have no adequate remedy at law for the future
injuries that are threatened, Defendants should be ordered to immediately release the insurance
proceeds to Plaintiffs.
PLAINTIFFS MARK D. MCHALE AND MICHAEL J. GRANT’S COMPLAINTEIGHTH CAUSE OF ACTION
(Right to Foreclosure — Real Property Claim)
73. Plaintiffs incorporate herein by reference the allegations set forth in paragraphs 1
through 72 above, as though fully stated herein.
74. As stated above, the HOA agreed to retain the services of Keamey to oversee the
repairs for the Eureka Property. Plaintiffs transferred their initial retainer of $5,000 to the HOA’s
account with Keamey and have since paid Kearney’s monthly fees separately from the retainer
payment.
68. The estimated total for the necessary repairs is approximately $180,000. Pursuant to
Section 4.7 of the CC&Rs, Defendant is responsible for 51.8% of all regular and special assessments
which is approximately $93,240 of the total estimated repair costs.
69. Per Section 3.4 of the CC&Rs the individual owners have the right to act unilaterally
on behalf of the HOA.
70. Additionally, Plaintiffs have the right to lien the Defendant’s property (219 Eureka)
and thereafter foreclose to collect the sum owned to the HOA pursuant to Section 4.10 of the CC&Rs.
71. Defendant should be enjoined from encumbering or selling his 219 Eureka until the
delinquent-assessment is paid in full. If Defendant is not enjoined from encumbering or selling 219
Eureka, Plaintiffs will be irreparably harmed, as they will be left with no option but to pay the total
sum themselves, in direct contravention of the CC&Rs.
72. Plaintiffs will be further harmed if Defendant is not enjoined until the delinquent
assessment is paid in full because, on information and belief, Plaintiffs and the HOA may have no
recourse to recover the amount Defendant is obligated to pay after Defendants sells 219 Eureka
Street.
PRAYER
WHEREFORE, Plaintiffs Mark D. McHale and Michael J. Grant pray for judgment as follows:
1. Judgment for monetary damages in favor of Plaintiffs Mark McHale and Michael Grant
against Defendant according to proof;
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2. An order against Defendant to immediately agree to proceed with repairing and maintaining
the common area roof and lightwell, remediate the wood destroying pest, remediate the dry
rot, repairing the dangerous and decaying rear stairs;
3. A declaratory judgment stating that (1) Defendant must agree to the necessary common area
maintenance, (2) Defendant must agree to immediately repair the common area roof, the
common area lightwell, the common area building exterior, and common area rear stairs in
accordance with the bids for repairs obtained by Plaintiffs; (3) Defendant must agree to
immediately retain a structural engineer and general contractor to completely rebuild and
replace the common area rear stars with proper plans and permitting; (4) Defendant must pay
for his proportional share of all repair expenses per Section 4.7 of the CC&Rs;
4.An injunction against Defendant, enjoining Defendant from encumbering or selling 219
Eureka property until the delinquent assessment is paid in full, plus any late charges, interest,
fees, or costs, in accordance with the CC&Rs;
5. For reasonable attorneys’ fees and costs incurred in this matter; and
6. For such other and further relief as the Court may deem just and proper.
Dated: June 11, 2021 KAUFMAN, DOLOWICH & VOLUCK, LLP
u
By: p |
Morgan Cahill-Marsland, Esq.
Attorneys for Plaintiffs Mark D. McHale &
Michael J. Grant
PLAINTIFFS MARK D. MCHALE AND MICHAEL J. GRANT’S COMPLAINT
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0 em YN DH FB BW YN RYN YN YN NY NK KY KY Be Bee Be ee Be Be BSB Be eo IAD A FF 8 NO |= So wH AY DH BRB Ww N KF OD KAUFMAN DOLOWICH & VOLUCK, LLP A. Jeanne Grove (SBN 232312) Morgan Cahill-Marsland (SBN 309903) 425 California Street, Suite 2100 San Francisco, CA 94104 Telephone: (415) 926-7600 Facsimile: (415) 926-7601 Email: jgrove@kdvlaw.com Attorneys for Plaintiffs MARK D. MCHALE and MICHAEL J. GRANT SUPERIOR COURT OF CALIFORNIA COUNTY OF SAN FRANCISCO CGC-21-592767 MARK D. MCHALE, an individual; Case No. MICHAEL J. GRANT, an individual, PLAINTIFFS MARK D. MCHALE AND MICHAEL J. GRANT’S COMPLAINT FOR: Plaintiffs, y 1, BREACH OF GOVERNING . DOCUMENTS; WILLIAM RICHARD LAWSON, an 2, BREACH OF CONTRACT; 3. VIOLATION OF THE DAVIS- individual, and DOES 1-50, inclusive, STIRLING COMMON INTEREST DEVELOPMENT ACT, CIVIL Defendants. CODE § 4000, ez. seq.; NEGLIGENCE; DECLARATORY RELIEF; NUISANCE; CONVERSION; AND RIGHT TO FORECLOSURE — REAL PROPERTY CLAIM SAAN S Plaintiffs MARK D. MCHALE and MICHAEL J. GRANT (“Plaintiffs”) alleges, as follow: THE PARTIES 1. Plaintiffs MARK D. MCHALE and MICHAEL J. GRANT are individuals over the age of 18 residing in San Francisco, California, and are the current owner of a condominium unit located at 221 Eureka, San Francisco, California (“221 Eureka”) 221 Eureka is one unit of a two-unit PLAINTIFFS MARK D. MCHALE AND MICHAEL J. GRANT’S COMPLAINThomeowners’ association located at 219-221 Eureka Street, San Francisco, California (the “Eureka Property”). 2. On information and belief, Defendant William Richard Lawson is an individual over the age of 18 residing in San Francisco and the current record owner of 219 Eureka, San Francisco, California (“219 Eureka”), the second unit in the Eureka Property. 3. On information and belief, the Eureka Property is governed by 219-221 Eureka Street Homeowners’ Association, an unincorporated association, (the “HOA”), which, at all times herein mentioned, is a common interest development with its principal place of business within the City and County of San Francisco. 4. On information and belief, the HOA is govemed by a Declaration of Restrictions and Condominium Plan (the "CC&Rs") and the Bylaws of the 219-221 Eureka Street Homeowners’ Association (the “Bylaws”) collectively the “Governing Documents”. A copy of the CC&Rs is attached as Exhibit 1. A copy of the Bylaws is attached as Exhibit 2. 5. The true names and capacities, whether individual, corporate, associate, or otherwise of DOES 1 through 50, inclusive, are unknown to Plaintiffs, who therefore sue said defendants by such fictitious names. Plaintiffs will move to amend this Complaint to show such defendants’ true names and capacities when the same have been ascertained. Plaintiffs further believe, and thereupon alleges, that each of the fictitiously named defendants is in some manner, means, or degree connected with the matters herein alleged and is liable to Plaintiffs thereon. GENERAL ALLEGATIONS 6. Section 12.1 of the CC&Rs states, “[t]he Association, or any Owner may enforce the Governing Documents. An Owner or the Association may enforce the Governing Documents by legal action. [...].” 7. Defendant, by virtue of his ownership of 219 Eureka Street, is a member of the HOA, pursuant to Section 3.2 of the CC&Rs. 8. Plaintiffs purchased 221 Eureka Street on or about October 2015 as their principal place of residence and are also members of the HOA by virtue of their ownership of 221 Eureka Street. PLAINTIFFS MARK D. MCHALE AND MICHAEL J. GRANT’S COMPLAINTwn co Oo ID DW 9. For years, Plaintiffs have attempted to addressed necessary repair and maintenance projects in the building, which the HOA is required to perform. The outstanding issues include, but are not limited to, painting the building, active termites/damage, and rear stair damage. 10. Plaintiffs have participated in mediation on several occasions with Defendants over the past several years without success. Defendants did at one point in March 2019 agree to paint the building and also address common area pest damage as part of the painting project. But thereafter, Defendants refused to move forward with the work. 11. Defendant has flatly refused to perform almost any building maintenance in the last five (5) years. In the meantime, the Eureka Property has continued to deteriorate without proper maintenance. 12. Inor about September 2020, Plaintiffs obtained multiple bids, at their sole cost, for maintenance including roof repair, which included work in the lightwell; repairing the pest and dry rot issues; and the back stairs repair. Defendant failed to respond to the proposed bids or Plaintiff's requests to repair the Eureka Property. 13. Inor around April 2021, Plaintiffs retained Kevin Kearney (“Kearney”) of Kearney and O’Banion, a licensed contracting company, to conduct an inspection of the Eureka Property and paid-a $5,000 retainer. On April 12, 2021, Kearney inspected the Eureka Property and issued a life safety warning because of the state of the rear stairs of the Eureka Property. Kearney informed the Plaintiffs that the area should be blocked off with caution tape and no one should use the stairs at all. Plaintiffs blocked off the stairs and informed Defendant of the serious state of the stairs and that no one should use the stairs. 14. On information and belief, Defendant disregarded Kearney’s warning and removed the caution tape and has resumed use of the dangerous rear stairs. Plaintiffs are further informed and believe that Defendant has also allowed guests and invitees to use the dangerous stairs. 15. Defendant agreed that the HOA (Plaintiffs and Defendant) should retain Plaintiffs’ construction consultant Kearney to oversee the repairs of the Eureka Property. Kearney issued a consulting agreement for the HOA on May 6, 2021 and began work on behalf of the HOA at that time. Plaintiffs paid the retainer amount in the amount of $5,000 on behalf of the HOA. PLAINTIFFS MARK D. MCHALE AND MICHAEL J. GRANT’S COMPLAINT16. | To date, Defendant has not paid for his portion of Kearney’s retainer or any of the amounts that the HOA owes Kearney for Kearney’s work on the Eureka Property to date. 17. Plaintiffs have paid all sums owed to Kearney and are therefore owed a reimbursement from the Defendant. 18. The total estimated costs of the repairs will be at least $180,000. Plaintiffs have paid a portion of these repair costs on behalf of the HOA and will be covering these costs, until Defendant pays his 51.8% share of the costs, as required under the CC&Rs. FIRST CAUSE OF ACTION (Breach of Governing Documents) 19. Plaintiffs reassert and re-allege paragraphs 1 through 18 of this Complaint as though fully set forth herein. 20. As set forth above, 219-221 Eureka Street is governed by the Governing Documents attached as Exhibit 1. Pursuant to the Davis-Stirling Act, the declaration of covenants and restrictions governing a common interest development are enforceable as equitable servitudes and “shall insure to the benefit of and bind all owners of separate interests in the development.” The owner of a separate interest may enforce the declaration and governing documents. 21. As set forth above, the Defendant has committed multiple breaches of the Governing Documents. To date, Defendant has refused in bad faith to repair and maintain the common area roof and lightwell, remediate the wood destroying pest, remediate the dry rot, repair the dangerous and decaying rear stairs, subjecting the Eureka Property to significant damage. The Association has a duty to maintain the common areas and should have promptly made the necessary repairs when it was first made aware of the issues years ago. 22. Plaintiffs have performed all of their obligations legally required of them under the Governing Documents. 23. As a proximate result of the Defendant’s breaches as herein alleged, Plaintiffs have been harmed in an amount to be proven at trial in excess of the jurisdiction of this court. 24. In addition, because Plaintiffs have no adequate remedy at law for the future injuries that are threatened, Defendant should be ordered to immediately address the rear stairs and repair the PLAINTIFFS MARK D. MCHALE AND MICHAEL J. GRANT’S COMPLAINTdamage caused to avoid injury to the individuals who use the stairs. SECOND CAUSE OF ACTION (Breach of Contract) 25. Plaintiffs incorporate herein by reference the allegations set forth in paragraphs 1 through 24 above as though fully stated herein. 26. As set forth above, the Association, including all of its members, is governed by the Governing Documents attached as Exhibit 1. 27. Asset forth above, the Defendant breached the Governing Documents. The Defendant has refused in bad faith to repair and maintain the common area roof and lightwell, remediate the wood destroying pest, remediate the dry rot, repair the dangerous and decaying rear stairs, subjecting the Eureka Property to significant damage. 28. Plaintiffs have performed all obligations legally required of them under the Governing Documents. 29. As a proximate result of Defendant’s breach as alleged herein, Plaintiffs have been harmed in an amount to be proven at trial in excess of the jurisdiction of this Court. 30. In addition, because Plaintiffs have no adequate remedy at law for the future injuries that are threatened, Defendant should be ordered to immediately address the rear stairs and repair the damage caused to avoid injury to the individuals who use the stairs. THIRD CAUSE OF ACTION (Violation of the Davis-Stirling Act Common Interest Development Act, Civil Code § 4000 et seq.) 31. Plaintiffs incorporate herein by reference the allegations set forth in paragraphs 1 through 30 above as though fully stated herein. 32. Asset forth above, the Defendant violated the Davis-Stirling Act in multiple respects. Civil Code Section 4775 provides that the HOA, and therefore its members, is responsible for repairing, replacing, and maintaining the common areas of the Eureka Property. The roof, lightwell, building exterior, and rear stairs are common areas and must be maintained by the HOA. See Section 8.2 (A) and 8.2 (B) of the CC&Rs. PLAINTIFFS MARK D. MCHALE AND MICHAEL J. GRANT’S COMPLAINT33. To date, Defendant has refused in bad faith to maintain and repair or even adequately investigate the damage to the roof, lightwell, building exterior, and rear stairs. 34. Asa proximate result of Defendant’s violations of law, Plaintiffs have been harmed in an amount to be proven at trial in excess of the jurisdiction of this Court. 35. In addition, because Plaintiffs have no adequate remedy at law for the future injuries that are threatened, Defendant should be ordered to immediately address the dangerous rear stairs and repair the damage to avoid injury to the Parties. 36. Civil Code Section 4775 provides that the Association is responsible for repairing, replacing, and maintaining the common area of the Property. 37. Plaintiffs have performed all of their obligations as members of the Association legally required of them under Davis-Stirling Act. 38. As a proximate result of Defendants’ violations of the Davis-Stirling Act, Plaintiffs have been damaged in an amount according to proof. FOURTH CAUSE OF ACTION (Negligence) 39. Plaintiffs incorporate herein by reference the allegations set forth in paragraphs 1 through 38 above as though fully stated herein. 40. Defendant, a HOA member, owes a duty of ordinary care to the other members/shareholders, Plaintiffs, to perform the duties of the HOA in good faith, in a manner that is in the best interest of the HOA, and with such care as an ordinary prudent person in a like position would use in similar circumstances, including reasonable inquiry. Defendant also owes a duty to its members, including the Plaintiffs, to be familiar with and fulfill the obligations under the law and the Governing Documents. Defendant also owes a duty to other members, including the Plaintiffs, to maintain the common areas of the property in a reasonable manner to prevent injury to third persons and their property. 41. As set forth above, Defendant, failed to know and obey the laws and the Governing Documents by failing to promptly investigate and repair the damage to the Eureka Property, thereby causing unnecessary damage to the Eureka Property, and failing to maintain the common area to PLAINTIFFS MARK D. MCHALE AND MICHAEL J. GRANT’S COMPLAINTwn prevent damage. 42. Asa proximate result of the Defendant’s negligence as alleged herein, Plaintiffs have been harmed in an amount to be proven at trial in excess of the jurisdiction of this Court. FIFTH CAUSE OF ACTION (Declaratory Relief) 43. Plaintiffs incorporates herein by reference the allegations set forth in paragraphs 1 through 42 above as though fully stated herein. 51. An actual controversy has arisen and now exists between Plaintiffs, on the one hand, and Defendant, on the other hand, concerning (1) necessary common areas maintenance and repair of the common area roof, the common area lightwell, the common area building exterior, and the common area rear stairs, (2) the proper scope of work to repair the common area roof, the common area lightwell, the common area building exterior, and the common area rear stairs, and (3) the procedure, scope, and necessity of repair work for the rear stairs; and (4) the cost of the necessary scope of repairs. 52. With respect to the first issue, Plaintiffs contends that the HOA must immediately agree to repair the common area roof, the common area lightwell, the common area building exterior, and the common area rear stairs so as to prevent any further damage to the Eureka Property. 53. With respect to the second issue, Plaintiffs contends that the HOA must immediately repair the common area roof, the common area lightwell, the common area building exterior, and common area rear stairs in accordance with the bids for repairs obtained by Plaintiffs. 54. With respect to the third issue, Plaintiffs contends that the HOA must immediately retain a structural engineer and general contractor to completely rebuild and replace the common area rear stars with proper plans and permitting. 55. With respect to the fourth issue, Plaintiffs contends that the cost of the necessary scope of repairs must be apportioned pursuant to Section 4.7 of the CC&Rs. 56. Defendant is expected to refute these contentions and therefore an actual controversy exists between Plaintiffs and Defendant. Plaintiffs request declaratory judgment as PLAINTIFFS MARK D. MCHALE AND MICHAEL J. GRANT’S COMPLAINToo mI DOD HW RF WN = RYN NY NY SY N NK KY KY Se Se Be es Be Be Be Be oN A mA BF BH =F SG ON DH BF WN = follows: (1) Defendant must agree to the necessary common area maintenance, (2) Defendant must agree to immediately repair the common area roof, the common area lightwell, the common area building exterior, and common area rear stairs in accordance with the bids for repairs obtained by Plaintiffs; (3) Defendant must agree to immediately retain a structural engineer and general contractor to completely rebuild and replace the common area rear stars with proper plans and permitting; (4) Defendant must pay for his proportional share of all repair expenses per Section 4.7 of the CC&Rs. SIXTH CAUSE OF ACTION (Nuisance) 57. Plaintiffs incorporate herein by reference the allegations set forth in paragraphs 1 through 56 above, as though fully stated herein. 58. Civil Code section 3479 defines a nuisance as: "Anything which is injurious to health, including, but not limited to, the illegal sale of controlled substances, or is indecent or offensive to the senses, or an obstruction to the free use of property, so as to interfere with the comfortable enjoyment of life or property." 59. Asset forth above, Defendants has refused to pay for and conduct basic maintenance to the Eureka Property causing it to fall into disrepair. The damage to the Eureka Property poses a life and safety risk to all the parties as well as any invitees. 60. Defendants refuses to repair the damage to the Eureka Property which has caused parts of the Eureka Property, including but not limited to the rear stairs, to be unusable and extremely dangerous. 61. | The Defendant’s conduct in failing to act and maintain the Eureka Property was intentional and unreasonable, the condition that Defendant created and permitted to exist was the result of an abnormally dangerous activity. 62. Asaresult of Defendant’s refusal to repair and maintain the Eureka Property, Plaintiffs have been harmed as they have been unable to use the Eureka Property which directly interferes with their comfortable enjoyment of the Eureka Property. PLAINTIFFS MARK D. MCHALE AND MICHAEL J. GRANT’S COMPLAINTCeo YN DH FB BW NY RN NY NY NY NY NR KY NY Be Bee Be ee Be ewe eB eo aA A RB BN =F FG SD Oe HN DH BF Ww NY KF SEVENTH CAUSE OF ACTION (Conversion) 63. Plaintiffs incorporate herein by reference the allegations set forth in paragraphs 1 through 62 above, as though fully stated herein. 64. As stated above, the HOA agreed to retain the service of Kearney to oversee the repairs for the Eureka Property. Plaintiffs transferred their initial retainer of $5,000 to the HOA’s account with Kearney and have since paid Kearney’s monthly fees separately from the retainer payment. 65. Plaintiffs are entitled to reimbursement from Defendant for his portion of Kearney’s retainer as well as his portion of Kearney’s monthly cost as the fees are HOA fees and not the sole responsibility of the Plaintiffs. 66. Pursuant to Section 4.7 of the CC&Rs which states, “The expenses for regular assessments are payable 51.8% by the Owner of Unit 219 and 48.2% by the Owner of Unit 221. Special assessments are divided between the Owners on the same basis as regular assessments.” 67. Defendant has intentionally and substantially interfered with Plaintiffs’ right to be reimbursed for the sum by completely ignoring requests for reimbursement, and knowingly withholding the funds from the Plaintiffs. 68. | On information and belief, Defendant has misappropriated the funds for his own personal use. 69. Plaintiffs did not consent in any manner to Defendants taking the funds at issue for their benefit. 70. Defendants’ misappropriation of the money he owes Plaintiffs for his own benefit was a substantial factor in causing Plaintiffs’ harm. 71. Plaintiffs have been damaged in an amount to be proven at trial as a result of Defendants’ actions in converting and misappropriating the insurance proceeds. 72. — Inaddition, because Plaintiffs have no adequate remedy at law for the future injuries that are threatened, Defendants should be ordered to immediately release the insurance proceeds to Plaintiffs. PLAINTIFFS MARK D. MCHALE AND MICHAEL J. GRANT’S COMPLAINTEIGHTH CAUSE OF ACTION (Right to Foreclosure — Real Property Claim) 73. Plaintiffs incorporate herein by reference the allegations set forth in paragraphs 1 through 72 above, as though fully stated herein. 74. As stated above, the HOA agreed to retain the services of Keamey to oversee the repairs for the Eureka Property. Plaintiffs transferred their initial retainer of $5,000 to the HOA’s account with Keamey and have since paid Kearney’s monthly fees separately from the retainer payment. 68. The estimated total for the necessary repairs is approximately $180,000. Pursuant to Section 4.7 of the CC&Rs, Defendant is responsible for 51.8% of all regular and special assessments which is approximately $93,240 of the total estimated repair costs. 69. Per Section 3.4 of the CC&Rs the individual owners have the right to act unilaterally on behalf of the HOA. 70. Additionally, Plaintiffs have the right to lien the Defendant’s property (219 Eureka) and thereafter foreclose to collect the sum owned to the HOA pursuant to Section 4.10 of the CC&Rs. 71. Defendant should be enjoined from encumbering or selling his 219 Eureka until the delinquent-assessment is paid in full. If Defendant is not enjoined from encumbering or selling 219 Eureka, Plaintiffs will be irreparably harmed, as they will be left with no option but to pay the total sum themselves, in direct contravention of the CC&Rs. 72. Plaintiffs will be further harmed if Defendant is not enjoined until the delinquent assessment is paid in full because, on information and belief, Plaintiffs and the HOA may have no recourse to recover the amount Defendant is obligated to pay after Defendants sells 219 Eureka Street. PRAYER WHEREFORE, Plaintiffs Mark D. McHale and Michael J. Grant pray for judgment as follows: 1. Judgment for monetary damages in favor of Plaintiffs Mark McHale and Michael Grant against Defendant according to proof; PLAINTIFFS MARK D. MCHALE AND MICHAEL J. GRANT’S COMPLAINT0 Oo YN DH BF BW NY NN NY NY YN NY N NN Bee ee Be we Be Be eB oN DA A KF BN |= SBC wo ADH BF Ww NH KF Oo 2. An order against Defendant to immediately agree to proceed with repairing and maintaining the common area roof and lightwell, remediate the wood destroying pest, remediate the dry rot, repairing the dangerous and decaying rear stairs; 3. A declaratory judgment stating that (1) Defendant must agree to the necessary common area maintenance, (2) Defendant must agree to immediately repair the common area roof, the common area lightwell, the common area building exterior, and common area rear stairs in accordance with the bids for repairs obtained by Plaintiffs; (3) Defendant must agree to immediately retain a structural engineer and general contractor to completely rebuild and replace the common area rear stars with proper plans and permitting; (4) Defendant must pay for his proportional share of all repair expenses per Section 4.7 of the CC&Rs; 4.An injunction against Defendant, enjoining Defendant from encumbering or selling 219 Eureka property until the delinquent assessment is paid in full, plus any late charges, interest, fees, or costs, in accordance with the CC&Rs; 5. For reasonable attorneys’ fees and costs incurred in this matter; and 6. For such other and further relief as the Court may deem just and proper. Dated: June 11, 2021 KAUFMAN, DOLOWICH & VOLUCK, LLP u By: p | Morgan Cahill-Marsland, Esq. Attorneys for Plaintiffs Mark D. McHale & Michael J. Grant PLAINTIFFS MARK D. MCHALE AND MICHAEL J. GRANT’S COMPLAINT