A Superior Court judge said he will study testimony and arguments made during a five-hour hearing Oct. 21 before deciding whether to stop the Foothills Club West Association Board from taking any action on the future of the beleaguered golf course until at least next year.
Judge Daniel Kiley’s announcement came after he queried the board’s lawyer on whether the HOA board could legally vote behind closed doors in 2018 and 2019 to assume the declarant rights that govern land use regulations for the site.
Kiley also questioned the board’s lawyer on whether it would suffer any harm if he issued an injunction forbidding it until at least February from advancing any plan submitted by The Edge, the four-man group that bought the site.
Kiley presided over a hearing on the Club West Conservancy’s request for a temporary restraining order pending the outcome of a tentative February trial on its claim that the board had no authority to assume the course’s declarant rights without the approval of 75 percent of the community’s 2,600 homeowners.
But Kiley also must decide whether there will even be a trial on the Conservancy’s suit since the board is seeking the suit’s dismissal on grounds that the organization, a nonprofit whose members are Club West homeowners, have no rights to challenge the board’s actions.
That issue will be decided on the basis of briefs. Conservancy lawyer Francis Slavin must submit his by next Wednesday, Nov. 4.
The Edge and a subsidiary group, Community Land Solutions, want to turn the course into The Park at Club West, paying for that development by selling pieces of the site to a homebuilder for construction of an unstated number of houses.
During the hearing, Conservancy President Matt Tyler and resident Ellen Davis testified that any homes on the course would harm their quality of life and that new home construction would lower their own home values.
In the suit, the Conservancy said home construction on any part of the course would spoil views and lower the values of 347 homes along the course that cost their owners as much as an extra $80,000 in premium lot prices.
But board member Paul Moroz testified that he didn’t necessarily agree with those assertions.
“I am not 100 percent convinced that their home values would decrease,” Moroz testified. “As a matter of fact, in the original Edge proposal, homes that were going to be built behind their homes had enough green space in between their homes that they wouldn’t be impacted.”
Moroz also testified the new homes that the Edge proposed in an eventually aborted plan would be worth more than the existing houses “and there are some opinions that their values could have gone up because they wouldn’t have a dead course and there’s homes that are feeding their values in that neighborhood which would bring their values up.”
Board attorney Carlotta Turman argued that homeowners have no guarantee the site will always remain a golf course, citing Club West’s master declaration.
Both Moroz and board President Michael Hinz testified about why the board assumed the declarant rights to the course and outlined the safeguards the board included to ensure that Club West homeowners would have a vote on the site’s future use.
Hinz testified about the board’s concerns after Richard Breuninger filed for bankruptcy and could no longer pay the note held by course owner Wilson Gee, who now holds the Edge’s note for the course’s $750,000 purchase price.
““We were concerned that a bad actor or a lender or some creditor might be able to exert influence over the outcome of the golf course,” Hinz testified.
“So, in consultation with our attorneys,” he said, “we decided that the best course of action was to take control of this segment and provide some opportunity for the community to vote.”
Both he and Moroz also testified that they added safeguards by requiring that any change to the golf course required the approval of a majority of 31 percent of the homeowners.
“We are mailing out 2,600 ballots and a quorum is established if we get 31 percent of those 2,600 ballots,” Moroz testified. “We would still need 50 percent plus 1” to approve any change.
The Conservancy maintains that 75 percent of all homeowners must approve any change in the site’s use while the board asserts that although that requirement is necessary to change the master declaration governing the association, the course is not covered by the master declaration and hence can be governed by a different ratio of votes.
Both Moroz and Hinz also testified that the board has had no discussions with the Edge on its new proposal. Hinz also testified the board has not voted on whether to schedule a presentation by the Edge for a meeting next month. Any board vote likely will hinge on Kiley’s eventual ruling.
During final arguments, Turman said testimony showed, “The board is looking out for members of the association and trying to act in the best interests of the community without favoring any specific group of homeowners.”
She also said that the Conservancy had not proved it would be harmed if an injunction is not granted.
But Slavin reiterated his contention that only an injunction could stop the board from putting a new Edge plan up for a community vote before the merits of the Conservancy’s lawsuit can be decided.
Kiley did note that the Conservancy had narrowed its original injunction request, which he said could have been interpreted as stifling the board’s First Amendment rights to talk with the Edge and that it instead simply wants the board from taking any official actions.
The judge also asked Turman whether the open meetings law that governs HOAs allowed the board to take votes in secret, as it did when it assumed the declarant rights. Turman said she thought there were exceptions allowing for that, but did not elaborate.