BEACHWALK UPDATE

 

 

COURT HEARING TO AMEND THE BW CC&Rs 1. LETTER TO HOMEOWNERS 2. ORDER OF HEARING AND NOTICE TO AMEND THE CC&RS 3.PETITION TO AMEND THE CC&RS. 4. EXHIBITS 1-8 5. EXHIBITS 9-22

 

VIRTUAL BEACHWALK PHOTOS: PAINTING, ROOF and LANDSCAPE PROGRAMS - 2011

19856 Saltwater Circle
New Hoyt Presidential TL Roof
note difference with old roof at bottom right of photo

2011 RESERVE STUDY AND SUMMARY ON -LINE

LITIGATION UPDATE (OCT 28, 2011)

Attorneys representing Beachwalk and the attorney representing plaintiffs Mr. Dukellis and Mr. Wittenberg appeared in court on October 28th.  Judge Colaw stayed (postponed) the Association’s Petition to Amend the CC&Rs pending a trial (non-jury) on the suit filed by the plaintiffs to invalidate the August 2011 election on Amendment 8.

The trial on this suit is scheduled to be held on January 17-18, 2011 at the Superior Court in Santa Ana, Department C25.  Interested homeowners are encouraged to attend.  The Petition to Amend the CC&Rs will be considered only if the court decided that the August 2011 election was valid.

Judge Colaw also continued the trial for the original lawsuit on pool 3 and 5 closures filed by Mr. Gallegos, Mr. Wittenberg, and Mr. Dukellis (Mr. Gallegos has removed his name from this suit).  The trial was originally scheduled for February 2012 and has been rescheduled for April 30, 2012.  Interested homeowners are also encouraged to attend this trial.

Both sides advised the court that the parties did not want any needless delay of the pool closure trial.

LITIGATION UPDATE (SEPT 14, 2011)

On Wednesday, September 14th, the parties to the Wittenberg lawsuit attended mediation with Retired Judge Patricia Collins. Beachwalk was represented by Adams & Kessler, Macrae & Edrington, and an adjuster from Farmer’s insurance. The plaintiffs were represented by Schiffer & Buus. Judge Collins spoke with the parties separately and attempted to reach a settlement of the dispute. No settlement was achieved. The plaintiffs made an offer to settle the lawsuit. We made a counter offer and plaintiffs left mediation without responding to Beachwalk’s counter offer. The specifics of the mediation are confidential.

On September 14th, Paul Wittenberg and Raymond Dukellis served our attorneys with another lawsuit against Beachwalk HOA. They are asking the judge to declare the results of the August, 2011 election void. The claim is that the Association violated Civil Code Section 1363 by not giving the plaintiffs and other opponents of Amendment 8 a chance to include their opinions and viewpoints in the election mailings, association media, newsletters, HOA website, and common area meeting spaces during the campaign.  Our attorneys will vigorously defend the election and Board actions before and during the election.

On Friday, September 16th, Judge Colaw denied the plaintiff's motion to compel Beachwalk HOA to provide further discovery responses related to all alterations, additions and improvements related to all common area costing over $1000 that did not receive a 2/3 vote from 2006 to the present. Plaintiffs were also denied their request for attorney fees related to filing their motion to compel.  The motion was denied without prejudice and plaintiffs may serve more specific discovery requests to Beachwalk related to other common areas besides the pool.  With regard to several other discovery requests, the motion to compel was continued to October 7,  2011.
 
Plaintiffs have also filed a Motion for Leave to file an Amended Complaint in the original Wittenberg case that is scheduled for hearing on October 14, 2011.  Plaintiffs are requesting to add allegations to the Complaint related to Beachwalk’s alleged failure to maintain Pools 3 and 5.  Plaintiffs will seek a temporary restraining order, preliminary injunction and permanent injunction requiring Beachwalk to maintain the common areas, including but not limited to Pools 3 and 5, and open the pools for community use. Beachwalk’s attorneys will oppose this motion.  
 

UPDATE TO LAWSUIT (AUGUST 26 , 2011)

August 26, we attended the hearing on Plaintiffs’ Motion to Clarify the Previously Entered Preliminary Injunction. The Court issued a tentative ruling just before the hearing and a copy is attached. The Court granted the motion clarifying the preliminary injunction but denied the relief requested by the plaintiffs. The Court clarified that the injunction did not prohibit maintenance of the pools, but it also did not mandate Beachwalk to undertake maintenance of the pools. Mandatory injunctions are rarely granted. Plaintiffs counsel indicated at the hearing that plaintiffs never sought a mandatory injunction, only clarification of the court’s prior injunction. The tentative ruling was adopted as the order of the Court.

Tentative Ruling

UPDATE TO LAWSUIT (AUGUST 12, 2011)

POOL 3 AND 5 STATUS

Recently your Beachwalk Pools and Recreation Committee undertook an independent study to definitively determine the deficiencies and building code violations at satellite swimming pools #3 and #5 which have prevented the HOA from operating those pools for the Summer season.

The ongoing Wittenberg & Dukellis vs. Beachwalk litigation against the HOA has halted all but routine pool area maintenance. The Pools & Recreation Committee is restricted, by court order, from undertaking any demolition, modification or improvement of the swimming pools, or the areas surrounding the pools, in excess of $1,000 without approval of at least 2/3 of the voting owners present at a special meeting at which a quorum is present.

The attached Aquapure reports list building code violations and safety hazards at each pool. Correction of the pool violations will easily exceed the $1,000 maximum expenditure, and to do so would be in violation of the court order.

We trust this information will be useful to the HOA in determining the magnitude of the repair problems which confront us at satellite pools #3 and #5.

Pool 3 Status
Pool 5 Status

UPDATE TO LAWSUIT (JULY 28 , 2011)

Letter from Farmer's Insurance

On July 28, 2011, the Beachwalk HOA received a letter from our insurance carrier (Farmer’s) advising us that they were offering limited insurance coverage for the current lawsuit (Wittenberg and Dukellis v. Beachwalk). This coverage, if accepted, will include only a portion of the expenses associated with the current lawsuit as the coverage is limited to the allegation by the plaintiffs that the Board of Directors breached its fiduciary responsibility by using a majority rather than a two-thirds quorum. The coverage letter also states that any award of attorney’s fees is not covered under a Directors and Officers Amendatory Coverage Endorsement. The coverage letter can be viewed at www.beachwalkhoa.org.

The Board has requested a meeting with the claims adjuster to discuss several important issues associated with this development, including:

• Effects of this litigation on our ability to get insurance coverage in future. Note that our current policy expires in September 2011. With a large, recent, unresolved claim on our record, it may be very difficult and costly to secure a new policy next month.
• Effects of their reservation of rights. In layperson terms, the insurance adjuster will seek a settlement immediately (which may or may not be in the best interests of the HOA in the long term), then possibly seek reimbursement from the HOA for costs associated with the non-covered elements of the case. Ultimately, the HOA may pay almost as much with insurance coverage as without.
• Making the transition from the HOA attorneys to the insurance-designated attorneys
  
  Note that the insurance coverage being offered is not full coverage against all of the claims made in Wittenberg and Dukellis v. Beachwalk, so the HOA legal expenses for the year will remain substantial. As of August 8, 2011, the HOA has not received any money from this claim.
  
  At the conclusion of the lawsuit, the Board will review how to handle any surplus from the recent special assessment (which was imposed before the HOA received any notification of insurance coverage).
  
  The need to update, modernize and remove ambiguous language from our CC&Rs remains. Settling this lawsuit will not protect the HOA from future lawsuits of a similar nature.

UPDATE TO LAWSUIT ( JUNE 13, 2011)

Aide Ontiveros, Attorney with AdamsKessler

Beachwalk’s counsel attended the Case Management Conference on June 6, 2011.  Of importance in setting a trial date, Judge Colaw’s comments indicated that he was unimpressed with plaintiffs’ allegations that Beachwalk has been improperly shutting down pools at Beachwalk without the membership’s consent.  He wondered what damages the plaintiffs could have suffered from the shutting down of pools and what remedy the plaintiffs ultimately seek.  Plaintiffs’ counsel stated that plaintiffs want Defendant to stop closing pools, the pools to be re-opened, and are seeking diminished value damages.  The Court indicated that this is a case that should be resolved and should not go to trial; so it did not wish to set an early trial date.  The trial date was set for February 27, 2012 at 9:30 a.m. and a Mandatory Settlement Conference for January 20, 2012 at 8:30 a.m., both in Department 25.  A trial setting after October was requested by plaintiff’s counsel and was due to the court’s congested trial calendar.

UPDATE TO LAWSUIT ( MARCH 23, 2011)

Update on Wittenberg, Gallegos and Dukellis v. Beachwalk
Our Beachwalk lawyers have provided the following update to the community:

The Association has requested that Plaintiffs (Wittenberg, Gallegos and Dukellis) submit the Beachwalk lawsuit to mediation to save costs and to resolve the litigation, and it has offered to split the costs of the mediation in accordance with our published dispute resolution process.  However, plaintiffs have refused to pay for their share of the costs of mediation.
 
Instead on March 23rd, plaintiffs propounded voluminous written discovery on the Association including form and special interrogatories, a request for admissions and a request for production of documents requesting numerous items from January 1, 2005 or October 14, 2006 to the present [including Board meeting minutes, committee meeting minutes, all documents evidencing any alteration, addition or improvement to the common area  including  notes, correspondence, memoranda, bids, estimates, agreements, change orders, reports, punch lists, invoices, receipts, voting materials, voting records and communications related to any alterations, additions or improvements to the common area costing more than $1000, newsletters, tallies, all communications between any member and the Association related to the litigation, board communications, communications with vendors and contractors, bank and financial statements, cancelled checks, general journals and ledgers, and estimates of future costs to maintain and repair any pool located at Beachwalk OR include a link to the discovery on your webpage. ]  

Plaintiffs’ refusal to pay their share of the proposed mediation and their aggressive discovery tactics will result in increased attorney fees and costs in this already costly litigation.  

Members are encouraged to vote yes for the 8th Amendment so that the litigation can be resolved expeditiously.  

     

  LAWSUIT AGAINST BEACHWALK (OCTOBER 12, 2010)
On October 12, 2010, the HOA was served with a lawsuit by 3 Beachwalk residents, Ray Dukellis, William Gallegos and Paul Wittenberg. The lawsuit alleges that the recent votes by the membership to remove satellilte pools 3 and 5 was invalid. In addition to stopping the removal of those pools, they have asked the court to prohibit the HOA from engaging in any alterations, improvements or additions to the common areas costing more than $1000 without a 2/3 approval of the community. See page 7, paragraph 24 of lawsuit.

Bulletin

Beachwalk sensitive materials are now password protected. These materials are intended for Beachwalk homeowners only.

• As such, the "financial" section of the web site is password protected. It currently contains the complete 2010 Reserve Study, and the latest available monthly actuals (December, 2009) .
• The status of the Beachwalk sewer project can be viewed here. It is also password protected.
• To view password protected materials, call Amber at Keystone Pacific, 1-949-838-3264 x 264. Give your name and BW address and you will be given the current ID and Password.