Opinion
D071465
09-15-2017
PALMS AND SANDS OWNERS ASSOCIATION, INC., Plaintiff and Appellant, v. BANK OF AMERICA, N.A. et al., Defendants and Respondents.
Catanzarite Law Corporation, Kenneth J. Cantazarite and Brandon E. Woodward for Plaintiff and Appellant. Bryan Cave, Andrea Hicks and Traci Choi for Defendants and Respondents.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (Super. Ct. No. PSC1501190) APPEAL from a judgment of the Superior Court of Riverside, David M. Chapman, Judge. Affirmed. Catanzarite Law Corporation, Kenneth J. Cantazarite and Brandon E. Woodward for Plaintiff and Appellant. Bryan Cave, Andrea Hicks and Traci Choi for Defendants and Respondents.
This is the second attempt by plaintiff Palms and Sands Owners Association, Inc. (Association) to recover unpaid homeowners association assessments from the secured lenders of a defaulting homeowner. In a prior action, the Association argued Bank of America and ReconTrust Corp. (Recon) were unjustly enriched because they were strategically delaying foreclosing on their defaulting borrower's residence to allow the real estate market to recover, all the while receiving the benefits provided by the Association (e.g., insurance, maintenance, utilities) without paying corresponding monthly assessments. We found no error in the trial court's sustaining of the defendants' demurrers. (See Palms & Sands Owners Assn., Inc. v. Bank of America, N.A. (Dec. 18, 2015, D068681 [nonpub. opn.], at p. *16 (Palms & Sands I).)
In this action, the Association sued Bank of America and Recon, as well as Citimortgage, Inc. (Citi), to recover the same homeowner's unpaid assessments, ostensibly under different legal theories than in the prior action. Based on our decision in Palms & Sands I, the trial court granted the defendants' motions for judgment on the pleadings. The Association contends the trial court erred in doing so. We affirm.
FACTUAL AND PROCEDURAL BACKGROUND
The Development and Association
"Palms & Sands" is a common interest development in Rancho Mirage, California. Sixteen of its 71 fee simple parcels are improved with residential duplexes (Residential Units); one parcel is improved with access roads, lawn area, a pool and pool house, and a laundry facility, all of which are used and shared by the owners in common.
The Association manages Palms & Sands under a Declaration of Covenants, Conditions, Restrictions and Easements (the Declaration) that governs each property owner within the development. The Declaration defines "owner(s)" as "[t]he parties . . . holding a recorded fee simple interest in a Lot . . . . 'Owner' does not include any party having an interest in a Lot merely as security for the performance of an obligation."
The Association maintains the common area roads, parking lot, pool, yard, and buildings; pays property taxes on the common lots; provides trash pickup for the Residential Units; maintains insurance coverage for common area and Residential Unit building structures ("meaning the owners need to only pay for 'walls in' coverage for unit contents"); and provides water service, general maintenance, and management services.
The Declaration authorizes the Association to require each owner to pay regular and special assessments "for improvement and maintenance of the Common Area(s), administration of the Property, and to promote the recreation, safety, and welfare for the common good of all the owners." Under this authority, the Association levied a regular monthly assessment to pay for the services described in the preceding paragraph. Under the Declaration, an owner's acceptance of a deed to a lot within the development constitutes the owner's agreement to pay the assessments, which are "the personal obligations of the owner . . . ."
If an owner fails to pay an assessment, the Declaration authorizes the Association to record a lien against that owner's lot. "In addition to all other legal rights and remedies," the Association may sue the owner to collect the unpaid assessments or foreclose on the lien.
Unit 8
In December 2002, Ron Bailey purchased a unit at Palms & Sands (Unit 8). In February 2005, he borrowed $129,000 from Countrywide. The loan was secured by a first deed of trust that named Recon as trustee. Countrywide assigned its interests in the first deed of trust to Citi in 2005. (See Palms & Sands I, supra, at p. *3.) Bank of America acquired Countrywide in early 2008, at which point Bank of America "became the servicer and special servicer" on the Citi loan.
The pleadings and record refer to various Countrywide entities. For simplicity, and because the distinctions are immaterial to the issues before us, we will refer to all of them, generally, as Countrywide.
In July 2005, Bailey obtained a $51,000 home equity line of credit from Countrywide. The line of credit was secured by a second deed of trust that also named Recon as Trustee. Incident to Bank of America's acquisition of Countrywide, Bank of America became "the owner and servicer/special servicer" on the home equity line of credit.
As a result of these transactions, Citi holds the first deed of trust; Bank of America holds the second deed of trust and is the servicer and special servicer of both loans; and Recon is trustee of both deeds of trust.
In about February 2010, Bailey defaulted on his loan and home equity line of credit, and stopped paying his assessments to the Association. Bailey died in March 2011. The Association initially opened an estate for Bailey, but his heirs had no interest in pursuing it because Unit 8 was then valued at less than $60,000 while its encumbrances exceeded $200,000.
The Prior Action
In 2012, the Association sued Bailey and other Residential Unit owners on a variety of legal theories to recover unpaid assessments. (See Palms and Sands Homeowner's Association v. Yale Oster (Super. Ct. Riverside County, 2014, No. RIC1207056 (Bailey).) The Association later added Bank of America and Recon as defendants on its claims against Bailey for breach of contract, breach of implied contract, unjust enrichment, and declaratory relief. Bank of America moved for judgment on the pleadings, and Recon demurred. The trial court granted their requested relief without leave to amend as to the contract and implied contract claims, noting the Association did "not dispute that [these] causes of action lack merit" as to these defendants. As to the claims for unjust enrichment and declaratory relief, the court granted the requested relief with leave to amend because the Association had, in the interim, filed a motion for leave to amend the complaint to " 'refine[]' " these claims.
The Association's counsel in this action, Kenneth J. Catanzarite, was also initially named as a plaintiff based on his status as "an owner of one or more of the sixteen residential units." He was dismissed as a plaintiff by way of a subsequent amendment.
For simplicity, we will refer to the prior action as "Bailey" even though he was not the first named defendant in that action.
The Association's first amended complaint included the refined claims for unjust enrichment and declaratory relief against Bank of America and Recon. The Association alleged that Bank of America was the lender on both of Bailey's loans secured by Unit 8, and Recon was "the trustee for the two deeds of trust as security" for those loans. The Association alleged Bank of America and Recon were reaping the benefits conferred upon Unit 8 under the Declaration at the Association's expense, without contributing toward them in the form of assessments:
It is unclear why the Association alleged this, when it appears Citi succeeded to Countrywide's interest on the first deed of trust in 2005. (See Palms & Sands I, supra, D068681 at p. *3.)
"[Bank of America] and [Recon] was [sic] informed that [Bailey] was not paying HOA fees but unreasonably and purposefully has [sic] delayed foreclosing will [sic] holding an every [sic] increasing approximate [sic] $200,000 balance due on [Bailey's] note secured by its/their trust deed on Residential Unit 8 by non-judicial foreclosure in order to benefit from market conditions such that it has been advantaged by such strategic delay which it knows will cause loss to Plaintiff in further and increased uncollectible HOA fees."
[¶] . . . [¶]
"[Bank of America] and [Recon] . . . continue to engage in strategic and wrongful delay in foreclosing on [Bailey]'s Residential Unit 8 for over 24 months now in order to benefit from market conditions so that it/they could obtain an advantage at Plaintiff's burden and expense in non-payment of knowingly accruing and unpaid HOA fees, late fees and interest."
Bank of America and Recon demurred to the first amended complaint, arguing there was nothing unjust about the Association's conferral of benefits upon Unit 8 because a lender may elect to foreclose on a defaulted loan "at its chosen time." While the demurrer was pending, the Association moved for leave to file a second amended complaint adding a cause of action for violation of California's Unfair Competition Law (UCL) (Bus. & Prof. Code, § 17200). The trial court sustained the demurrer without leave to amend, and ultimately denied the Association leave to amend to add the UCL claim. The Association appealed, and we affirmed. (See Palms & Sands I, supra, D068681.)
We agreed the Association had not alleged facts showing Bank of America or Recon had been unjustly enriched under the circumstances:
"The Association argues [Bank of America and Recon] are unjustly enriched because their 'benefit will never need to be repaid because when they finally decide market conditions are right, their foreclosure wipes out the unpaid [Association] fees so there is no reimbursement.' This argument is unavailing for several reasons. First, the Association ignores the fact Bailey (and his estate) are primarily responsible for the assessments. Even if [Bank of America and Recon] foreclose on Unit 8, Bailey's underlying contractual obligation to pay the assessments will survive foreclosure as the foreclosure only extinguishes junior liens, not the contractual obligations secured by them. [Citation.]
"Second, the Association is speculating regarding [Bank of America and Recon]'s motives and is assuming [their] eventual foreclosure and sale of Unit 8 would not yield sufficient proceeds to reimburse the Association for Bailey's unpaid assessments. Moreover, the Association cites no authority, and we are aware of none, that requires the holder of a deed of trust to foreclose at a particular time so that a homeowners association can replace a nonpaying owner with a paying one. To the contrary, lenders are generally entitled to foreclose if and when they choose. [Citation.]
"Third, it is unclear that [Bank of America and Recon] have received or ever will receive a benefit at the Association's expense. In light of the significant amount of debt encumbering Unit 8—$200,000 compared to its alleged value of $60,000—the only entity likely to benefit from the Association's efforts is the holder of the first deed of trust (nonparty Citi).
"Finally, and most fundamentally, the Association's grievance is not so much with [Bank of America and Recon] as it is with California's
lien priority scheme. That is, although the Association is entitled to record a lien of its own against Unit 8 to secure Bailey's unpaid assessments, that lien would be junior to the first and second deeds of trust and would be extinguished in the event of a foreclosure on either senior lien. [Citations.] The Association is not required to wait for senior lienholders to foreclose on their liens; it could foreclose on its own lien first. [Citation.] Yet the Association has not done so, presumably for the same type of strategic reasons for which it faults [Bank of America and Recon].(Palms & Sands I, supra, D068681, at pp. *12-*16, fns. omitted.)
"Moreover, although the parties have not cited any cases addressing homeowners association challenges to lien priority statutes, our independent research reveals that the courts that have considered such challenges . . . have rejected them. [Citations.]
"Our independent research also reveals that some state legislatures have addressed the Association's dilemma by adopting the Uniform Common Interest Ownership Act of 1982 (UCIOA) or similar statutory provisions that create a 'superpriority lien' for homeowners association assessments, which allow a portion of the assessments to survive foreclosure of an otherwise senior lien. [Citation.] However, California's Law Revision Commission recommended against adopting the UCIOA in 2003. [Citation.]"
As for the Association's claim that the trial court erred in denying leave to amend to allege a claim for violation of the "unfair" prong of the UCL, we explained "the Association [had] not cited any authority to which to 'tether' its UCL claim" as required by our court's prior decisions construing the UCL. (Palms & Sands I, supra, D068681, at pp. *20-*21.)
This Action
While the Palms & Sands I appeal was pending, the Association filed this action against Bank of America, Recon, and Citi (collectively, Defendants), asserting causes of action for (1) breach of the Declaration under Civil Code section 1589, (2) promissory estoppel, and (3) violation of the "unfair" prong of the UCL. The operative first amended complaint in this action alleges substantially similar background facts regarding the Association, the Declaration, and Bailey's Unit 8 (and encumbrances thereon) as were alleged in Bailey.
Civil Code section 1589 provides: "A voluntary acceptance of the benefit of a transaction is equivalent to a consent to all the obligations arising from it, so far as the facts are known, or ought to be known, to the person accepting."
The gravamen of the Association's claims in this action is that Defendants delayed foreclosing on Unit 8 so they could continue to reap the benefits conferred upon that unit under the Declaration at the Association's expense, without contributing toward them in the form of assessments:
"Defendants have intentionally and strategically delayed foreclosure of Unit 8 from 2010 through current date, a period of over 5 years, with the express intent and purpose of waiting for a recovery in the real estate market before foreclosing while all the time knowing that [their] obligations for protective advances to protect Unit 8 as collateral were being paid for by [the Association] which in turn received contributions from the other homeowners. [¶] [Citi] and [Bank of America] took such action of strategic delay because [they] knew that once [they] foreclosed on Unit 8 that [they] would thereupon be liable directly as owner for the HOA Fees accruing at least post foreclosure."As evidence of this tactic, the Association alleged that although Bank of America and Recon had "finally recorded a Notice of Default and Election to Sell Under Deeds of Trust for Unit 8" in August 2014, as of May 2015 Defendants still had not noticed the foreclosure sale.
The trial court abated this action pending the outcome of the appeal in the prior action. After we issued Palms & Sands I, Defendants moved for judgment on the pleadings on the basis it was a res judicata bar to the Association's claims in this action. The Association argued in opposition that res judicata did not apply because new facts occurring since Palms & Sands I demonstrated each defendant was "no longer a passive holder of a security interest," but rather, had "exercised dominion and control over the property and in [doing so] accepted the services and benefits provided by [the Association]." Specifically, the Association argued Defendants had exercised dominion and control over Unit 8 by (1) recording the notice of default in 2014; (2) contacting the Association in July 2015 to "obtain[] information about [the Association]'s insurance coverage information in connection with damages and necessary repairs to Unit 8" necessitated by vandalism to the vacant unit; and (3) using the roads and utilities provided by the Association when Defendants remediated the vandalism to landlocked Unit 8. Alternatively, the Association requested leave to amend to allege a new cause of action for trespass arising from Defendants' use of the roads and services provided by the Association under the Declaration.
After taking judicial notice of the record in Bailey and our Palms & Sands I opinion, the trial court granted Bank of America and Recon's motion on the basis of res judicata:
"It is clear that there are no material changes that would prevent the application of res judicata or collateral estoppel. Unless, or until, one of the lienholders (including [the Association] as a lienholder) forecloses on Unit 8 the fact remains that the current owner of the property is Bailey's Estate, and only Bailey's Estate is liable for
[assessments] pursuant to the terms of the [Declaration]. Accordingly, the [Court] grants the motion without leave to amend as amendment would be futile under the facts in this case."
The court also granted Citi's motion, but not "strictly" on res judicata grounds:
"Here, Citi was not a party to the prior action and the determinations in that case. In addition, the appellate court noted that [Bank of America and Recon] sat in a different position than Citi who was the only party likely to benefit from a foreclosure of their deed of trust as the holder of the first deed of trust. Further, [the Association] alleges facts that occurred since the determinations in that court proceeding. Accordingly, the court declines to grant the motion strictly on the basis of res judicata or collateral estoppel. [¶]
"However, the prior decisions have applicability in this case. As previously addressed by both the trial court and the appellate court, [the Declaration] expressly exclude[s] lenders from the definition of owners responsible for paying assessments. Citi is not the owner of Unit 8, but rather simply has a security interest in the property to secure its loan. Unless, or until, one of the lienholders (including [the Association] as a lienholder) forecloses on Unit 8 the fact remains that the current owner of the property is Bailey's Estate, and only Bailey's Estate is liable for [assessments] pursuant to the terms of the [Declaration]. [The Association]'s argument that Citi is obligated to pay the [assessments], and otherwise subject to the [Declaration], under an implied contract theory are unpersuasive and not supported by any reference to case law to support its position."
The court rejected the Association's argument that it should be granted leave to amend, reasoning the argument was "not properly before [the] court" because the Association "would have been required to file a motion for leave to file an amended complaint, which [the Association] failed to do."
The Association appeals.
DISCUSSION
I. Judgment on the Pleadings
A. Standard of Review
" 'A judgment on the pleadings in favor of the defendant is appropriate when the complaint fails to allege facts sufficient to state a cause of action.' " (People ex rel. Harris v. Pac Anchor Transp., Inc. (2014) 59 Cal.4th 772, 777, citing Code Civ. Proc., § 438, subd. (c)(3)(B)(ii).) " 'A motion for judgment on the pleadings is equivalent to a demurrer and is governed by the same de novo standard of review.' " (Ibid.) " 'All properly pleaded, material facts are deemed true, but not contentions, deductions, or conclusions of fact or law . . . .' " (Ibid.) "Courts may consider judicially noticeable matters in the motion as well." (Ibid.)
B. Res Judicata Principles
" 'Res judicata' describes the preclusive effect of a final judgment on the merits. Res judicata, or claim preclusion, prevents relitigation of the same cause of action in a second suit between the same parties or parties in privity with them." (Mycogen Corp. v. Monsanto Co. (2002) 28 Cal.4th 888, 896 (Mycogen).) The doctrine "is intended to preserve the integrity of the judicial system, promote judicial economy, and protect litigants from harassment by vexatious litigation." (Vandenberg v. Superior Court (1999) 21 Cal.4th 815, 829.) "Res judicata bars a cause of action that was or could have been litigated in a prior proceeding . . . ." (Federal Home Loan Bank of San Francisco v. Countrywide Financial Corporation (2013) 214 Cal.App.4th 1520, 1527.)
"Res judicata precludes the relitigation of a cause of action only if (1) the decision in the prior proceeding is final and on the merits; (2) the present action is on the same cause of action as the prior proceeding; and (3) the parties in the present action or parties in privity with them were parties to the prior proceeding." (Zevnik v. Superior Court (2008) 159 Cal.App.4th 76, 82; see Boeken v. Philip Morris USA, Inc. (2010) 48 Cal.4th 788, 797.)
" 'Two proceedings are on the same cause of action if they are based on the same "primary right." [Citation.] The plaintiff's primary right is the right to be free from a particular injury, regardless of the legal theory on which liability for the injury is based. [Citation.] The scope of the primary right therefore depends on how the injury is defined. A cause of action comprises the plaintiff's primary right, the defendant's corresponding primary duty, and the defendant's wrongful act in breach of that duty. [Citation.] [¶] An injury is defined in part by reference to the set of facts, or transaction, from which the injury arose.' " (Silverado Modjeska Recreation & Park District v. County of Orange (2011) 197 Cal.App.4th 282, 297-298.) "Thus, a single cause of action is based on the harm suffered, rather than on the particular legal theory asserted or relief sought by the plaintiff." (Balasubramanian v. San Diego Community College Dist. (2000) 80 Cal.App.4th 977, 991.)
"The concept of privity for the purposes of res judicata . . . refers 'to a mutual or successive relationship to the same rights of property, or to such an identification in interest of one person with another as to represent the same legal rights [citations] and, more recently, to a relationship between the party to be estopped and the unsuccessful party in the prior litigation which is "sufficiently close" so as to justify application of the doctrine of collateral estoppel.' " (Citizens for Open Access etc. Tide, Inc. v. Seadrift Assn. (1998) 60 Cal.App.4th 1053, 1069-1070 (Citizens for Open Access).) " ' "This requirement of identity of parties or privity is a requirement of due process of law." ' " (Ibid.)
" 'Privity is not susceptible of a neat definition, and determination of whether it exists is not a cut-and-dried exercise. [Citations.]' " (Citizens for Open Access, supra, 60 Cal.App.4th at p. 1070.) " 'In the final analysis, the determination of privity depends upon the fairness of binding appellant with the result obtained in earlier proceedings . . . .' " (Ibid.) " ' "Whether someone is in privity with the actual parties requires close examination of the circumstances of each case." [Citation.]' [Citation.]" (Ibid.)
C. Analysis
We conclude all three requirements of res judicata are satisfied with respect to all three Defendants and, thus, find no error in the trial court's granting them judgment on the pleadings.
Even though the trial court granted Citi's motion for judgment on the pleadings on a basis other than res judicata, we may affirm the judgment "if it is proper on any grounds raised in the motion even if the court did not rely on those grounds." (Mack v. State Bar of California (2001) 92 Cal.App.4th 957, 961.)
1. Final Judgment
There is no question that the judgment appealed and affirmed in Palms & Sands I is final and on the merits. Thus, the first requirement is satisfied.
2. Same Cause of Action
The same-cause-of-action requirement is satisfied because the Association seeks to vindicate in this action the same primary right it sought to vindicate in Bailey. In both actions, the Association alleged it has been harmed by Defendants' strategic decision to delay foreclosing on Unit 8 so that they can reap the benefits the Association is obligated by the Declaration to confer upon Unit 8 (e.g., insurance and common area maintenance), without bearing the burden of paying the assessments attributable to Unit 8. Although the Association has sought to vindicate this right via different legal theories, its claims all stem from the alleged invasion of the same primary right—the harm the Association has suffered by virtue of its provision of benefits under the Declaration to entities that are not paying assessments. This satisfies the same-cause-of-action requirement of res judicata.
The Association contends this requirement is not satisfied because the Association's claims in this action are based on "material changes in facts" that occurred since the Bailey judgment (recordation of the notice of default, Citi's inquiry regarding Association insurance, and Defendants' use of Association roads and services to access Unit 8). Of course, res judicata "may not apply when 'there are changed conditions and new facts which were not in existence at the time the action was filed upon which the prior judgment is based. [Citations.]' " (Planning & Conservation League v. Castaic Lake Water Agency (2009) 180 Cal.App.4th 210, 227-228, italics added.) However, this exception applies only when the changed conditions or facts are "material." (Id. at p. 229; see Citizens for Open Government v. City of Lodi (2012) 205 Cal.App.4th 296, 325.) The parties hotly contest whether the facts the Association cites are new; that is, whether they occurred before entry of the Bailey judgment or our Palms & Sands I decision. We need not resolve that dispute because, regardless of the facts' novelty, we conclude they are not material.
First, recordation of the notice of default is not a material factual change because the Association concedes no foreclosure sale took place and, thus, Defendants' status as lenders did not change. (See Salazar v. Thomas (2015) 236 Cal.App.4th 467, 481 [a notice of default does not affect ownership or possession].) As we observed in Palms & Sands I, the Declaration "expressly excludes lenders from the definition of owners responsible for paying assessments." (Palms & Sands I, supra, D068681, at p.
Second, regarding Citi's inquiry regarding whether the Association's insurance might cover the vandalism to Unit 8, the Association alleged in Bailey that it was unjust for the defendants to reap the benefit of the Association's insurance coverage without contributing toward it in the form of assessments. We rejected that general proposition in Palms & Sands I. (Palms & Sands I, supra, D068681, at p. *12 ["Although the Association alleges it has incurred expenses in maintaining the development's common areas and in insuring the collateral for Respondents' loans (Unit 8), we are not persuaded it would be unjust for Respondents to retain those benefits."].) The Association's invocation in this action of Citi's insurance inquiry is merely a specific instance of the general proposition we have already rejected. Thus, it is not a material change in facts.
Finally, regarding the Association's allegation that Defendants benefited from the use of roads and services maintained by the Association, we similarly rejected in Palms & Sands I the Association's allegation in Bailey that it was unjust for the defendants to reap the benefit of those services without contributing toward them in the form of assessments. (See Palms & Sands I, supra, D068681, at p. *12.) The Association's claim in this Action that Defendants availed themselves of those benefits while remediating the vandalism to Unit 8 is again merely a specific instance of the general proposition we have already rejected. Thus, it is not a material change in facts.
Because the Association seeks to vindicate the same primary right in this action as it did in Bailey—with no material intervening changes in facts—the same-cause-of-action requirement of res judicata is satisfied.
3. Privity
The Association, Bank of America, and Recon were all named parties in Bailey. Thus, the privity requirement of res judicata is satisfied as to the Association's claims against Bank of America and Recon.
As to Citi, we conclude that although it was not expressly named as a defendant in Bailey, it has a sufficiently close relationship with the Bailey defendants such that notions of due process will not be offended by applying res judicata to the Association's claims against Citi in this action. In Bailey, the Association alleged Bank of America was the beneficiary of the first deed of trust secured by Unit 8, and Recon was its trustee. Now, the Association alleges the first deed of trust "was subsequently assigned/acquired by Citi," and that Bank of America, "as servicer/special servicer[,] acts as an agent of [Citi] with regard to the [first deed of trust]." Thus, the Association's allegations establish that Citi is the successor-in-interest to the legal interests the Association litigated in Bailey. This is sufficient to satisfy the privity requirement of res judicata. (See, e.g., Amedee v. CitiMortgage, Inc. (N.D. Cal., Mar. 18, 2016, No. 15-CV-03356-HSG) 2016 WL 1070657, at *4; Horton v. JPMorgan Chase Bank, N.A. (N.D. Cal., Mar. 23, 2016, No. 15-CV-05322-WHO) 2016 WL 1139004, at *4.)
We found in Palms & Sands I that "Countrywide Bank assigned its interests in the first deed of trust to [Citi] in 2005." (Palms & Sands I, supra, D068681, at p. *3.) Thus, apart from the Association's allegations, it appears Citi was actually the holder of the first trust deed when the Association sued Bank of America in that capacity in Bailey.
II. Leave to Amend
The Association initially challenged in this appeal the trial court's denial of leave to amend. However, the Association withdrew this challenge during oral argument, explaining it has since filed a new trespass lawsuit against Defendants. We accept the Association's withdrawal. In doing so, however, we offer no opinion on the viability of the Association's newly asserted claim or whether our decisions in this case or Palms & Sands I constitute a res judicata bar thereto.
III. Conclusion
We reiterate our observation in Palms & Sands I that the Association is not without a remedy—the Declaration authorizes it to sue Bailey's estate for unpaid assessments, or to record and foreclose on a lien against Unit 8. (Palms & Sands I, supra, D068681, at p. *3.) The latter may prove to be unfruitful in light of Citi's and Bank of America's more senior deeds of trust. But as we observed, any such unfruitfulness is a product of California's lien priority statute (id. at p. *13), which our Legislature has chosen not to revise (id. at pp. *15-*16). It is not our role to second- guess the Legislature's treatment of these matters. (See People v. Rubalcava (2000) 23 Cal.4th 322, 333 [" '[T]he role of the judiciary is not to rewrite legislation to satisfy the court's, rather than the Legislature's, sense of balance and order.' "].)
DISPOSITION
The judgment is affirmed. The Association shall pay Defendants' costs on appeal.
HALLER, J. WE CONCUR: MCCONNELL, P. J. O'ROURKE, J.