In Sierra Palms Homeowners Association v. Metro Gold Line Foothill Extension Construction Authority, published January 29, 2018, the Second District Court of Appeal, Division 7 reversed the dismissal after demurrer of a homeowner's association's suit against a public transit entity. The homeowners association sued the Authority for allegedly interfering with the homeowners' quiet enjoyment and damaging property, including the condominium complex's boundary wall, amounting to a taking of property without just compensation. Based on failure to timely present a claim, the causes of action were narrowed down to inverse condemnation. The Authority demurred on the ground that the Association had no standing to sue for inverse condemnation, because it had no ownership interest in the property. The Association did not file an opposition to the demurrer. The trial court sustained it and dismissed the case.
The appellate court ruled that the trial court abused its discretion in not granting leave to amend. To obtain leave to amend, a plaintiff must show how the complaint could be reasonably amended. The showing may be made for the first time on appeal. For the first time on appeal, the Association advanced an argument that it had standing under Civil Code section 5980. That statute specially affords homeowners associations standing to sue for damage to common areas or separate areas the association has an obligation to maintain and repair. As a matter of first impression, the court ruled that section 5980 gives homeowners associations standing to sue for inverse condemnation based on damage to common areas, such as the Association's boundary wall.
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