Jury finds Rancho Bel Air POA committed “negligent misrepresentation,” Awards $20K punitive damages to homeowner Jonathan Friedrich
By Deborah Goonan, Independent American Communities
Jonathan Friedrich purchased his home in 2003, shortly after his retirement. Before he purchased the home, Friedrich was given a set of Covenants, Conditions, & Restrictions (CC&Rs) for Unit 2, although he later discovered that his house is in actually located in Unit 1, which was never subject to a legal homeowners’ association. Unaware of the truth, for more than a decade, the homeowner paid HOA assessments for common expenses such as the cost of gated security access.
While investigating another matter, the State of Nevada Real Estate Division discovered that Unit 1 was never an association. Realizing the error, his HOA attempted to convince Friedrich to sign documents to make his property part of HOA Unit 2, but he refused.
Friedrich later found out that four other owners in Unit 1 have never paid assessments.
Friedrich sued Rancho Bel Air POA (Unit 2) and its management agent, claiming that the HOA misrepresented its authority to invoice mandatory assessments for more than 10 years, and seeking full recovery of paid assessments, plus interest.
In 2016, a District Court ruled, in Friedrich’s favor, that his home is not part of any mandatory property owners association. In that ruling, a judge confirmed that Unit 2 CC&Rs exempt all of Unit 1 owners from the obligation to comply with Unit 2 CC&Rs.
But the battle did not end there. The District Court also ruled that the issue of whether or not Rancho Bel Air has the right to collect assessments from Friedrich remained an unsettled legal matter.
Since learning that his home was not part of Rancho Bel Air POA Unit 2, Friedrich has stopped paying assessments. The POA has continued its collection efforts, threatening to foreclose on his home for nonpayment.
Following the District Court ruling, Friedrich demanded a jury trial to settle the matter of the validity of Rancho Bel Air POA assessments, and to determine the extent of damages payable to Friedrich by the association. Friedrich’s attorney, Joel F. Hansen, Esq. of Cooper Levenson, filed complaints of fraud, misrepresentation, elder abuse, violation of the fair debt collection practices act, violation of the State Civil RICO act and 5 other causes of action.
Prior to trial, the Judge dismissed elder abuse, violation of fair debt collection practices act, and RICO (Racketeering) claims.
Finally, last month the case went to trial. As of June 29, 2017, a jury has reached a verdict in the case of Jonathan Friedrich vs. Rancho Bel Air POA Unit 2, Inc. and Performance CAM LLC.
The jury decided that Rancho Bel Air made a “negligent misrepresentation” to Friedrich, by claiming that his home was included as a property in a homeowners association for Unit 2, when, in fact, Friedrich’s house is situated in Unit 1, where there is no HOA.
The jury also awarded Friedrich 70% of assessments paid to Rancho Bel Air POA in the past, plus interest, court costs, and an additional $20,000 in punitive damages for its negligent misrepresentation.
According to a signed jury verdict, neither the POA nor management company, Performance CAM LLC, committed fraud or intentional misrepresentation. The jury did not find any negligence by the management company, and, therefore, no conspiracy between the POA and the Manager.
However, the jury’s verdict concurs with that of the District Court: Friedrich’s home is not part of Rancho Bel Air POA. The jury concluded that Friedrich has no obligation to pay assessments that have been billed by the POA .
Hansen will be filing a motion for recovery of attorney fees on behalf of Friedrich. A post-trial hearing is likely.
Contact information for Joel F. Hansen, Esq.
Friedrich vs. Rancho Bel Air – signed jury verdict of June 29, 2017
Statement from Jonathan Friedrich:
It has been a long 5 year battle but I won the fight against Rancho Bel Air in Las Vegas.
This was a complicated case with many twists and turns. From the outset I knew I was right and never wavered.
Even though the financial compensation I will receive is much less than what it cost me, it was a David vs Goliath battle with me winning the battle.
The bottom line is justice is expensive. If you want to fight the HOAs in this country you had better have a Fat Checkbook!