COUNSEL

Hickey, Neuland, Pardes & Colletta and Richard P. Neuland for Plaintiffs and Appellants. Feldsott, Lee & Van Gemert and Martin L. Lee for Defendant and Respondent.

OPINION

McDANIEL, J.

This is an appeal from a judgment of dismissal entered after an order sustaining the demurrer of defendant, Kite Hill Community Association (the Association), to the plaintiffs’ fourth amended complaint. Because we conclude that the plaintiffs finally succeeded in pleading a cause of action, we shall reverse the judgment.

FACTS [FN. 1]

As reflected by the allegations of plaintiffs’ complaint, Kite Hill is a residential community located in the rolling hills of southern Orange County.

Plaintiffs, Mr. and Mrs. Cohen, purchased a lot in Kite Hill which afforded a panoramic view of the surrounding countryside. They paid a premium for this view.

The Association, a nonprofit corporation duly organized and existing under the laws of California, is composed of all of the homeowners in Kite Hill. It [646] was organized by the developer, S & S Construction Company, for the purpose of administering and enforcing the declaration of covenants, conditions and restrictions (the Declaration) which was recorded as to the entire tract and incorporated by reference into the respective deeds by which all Kite Hill residents acquired their homes in this tract. The Declaration was also attached as an exhibit to the complaint.

Every owner of a lot in Kite Hill is automatically a member of the Association and subject to payment of regular and special assessments to the Association for the purpose of carrying out its community functions.

Shortly after the Cohens purchased their home, they submitted to the Association’s architectural committee (the Committee) plans for certain improvements and landscaping in their front and rear yards. The Declaration requires that such plans be submitted to the Committee in writing and be approved before any construction can begin.

One part of the plan approved by the Committee was a slump stone and wrought iron fence (a two-foot slump stone base topped by a three-foot iron fence). This is the type of fence designated by the Declaration for use in a lot such as the Cohens’; i.e., a side yard with a view.

Shortly thereafter, plaintiffs’ neighbors, the Ehles, received approval from the Committee to construct a solid slump stone fence immediately adjacent to the Cohens’ slump stone and wrought iron fence. The Ehles’ is the type of fence designated in the Declaration for a side yard without a view.

Plaintiffs objected to the installation of the nonconforming fence because they believed that it would materially obstruct their view. However, their efforts to persuade the Ehles and the Association to modify or prevent the construction were unsuccessful.

The Cohens then initiated this lawsuit against the Ehles and the Association, [FN. 2] and contemporaneously sought a temporary restraining order to prevent the Ehles from completing construction of the fence. Although the attorneys for plaintiffs and the Ehles stipulated to the issuance of a temporary restraining order pending a hearing, the fence was substantially completed by the time the hearing occurred. The trial court denied the temporary restraining order, and the plaintiffs withdrew their application for a preliminary injunction.

[647] Plaintiffs’ complaint [FN. 3] alleged that the Association and its architectural committee, in approving the Ehles’ construction plans, had: (1) breached the covenants contained in the Declaration; (2) breached their fiduciary duty owed to plaintiffs; (3) breached their duty of good faith and fair dealing; (4) been negligent; and (5) committed “willful misconduct or other intentional conduct.”

In the key charging allegations, the complaint alleged that the “solid wall of slump block as approved by the Association and installed by Defendants Ehle is not a permitted fence under Exhibit `C’ of the Kite Hill Restrictions …”; that the “approval by the Architectural Committee of the Architectural [sic] plans of Defendants Ehle … is in violation of the mandates of the Kite Hill Restrictions and a clear abuse of their discretion”; that the Association acted “with full knowledge of their breach of the recorded Kite Hill Restrictions … [and] … in willfull, conscious and reckless disregard for Plaintiffs’ rights”; and, that “as a direct and proximate result of the Defendant’s [sic] violation of the Kite Hill Restrictions the Plaintiffs have been damaged for the loss of use and enjoyment of their property and for diminution in the value of their property….”

Plaintiffs sought damages and a mandatory injunction to compel the Association to take certain steps to force the Ehles to comply with the architectural standards set forth in the Declaration.

The Association demurred to the plaintiffs’ complaint on the ground that it failed to state a cause of action and that it was “uncertain and unintelligible.” The trial court sustained the Association’s demurrer to the complaint. After the judgment of dismissal, plaintiffs filed this appeal.

DISCUSSION

A. The Association’s Duties Under the Declaration

The fundamental question presented here is whether plaintiffs’ complaint alleged facts sufficient to state a cause of action against the Association. More precisely, did the complaint allege facts sufficient to establish that the Association owed a duty to plaintiffs and that the former breached that duty, thereby entitling plaintiffs to some or all of the remedies sought? Such a determination must be based on the terms and conditions of the Declaration. We shall proceed, therefore, to an examination of the relevant provisions of this document before turning to the central question of duty.

As previously noted, the Association is a nonprofit corporation whose members are the owners of homes in the Kite Hill development in Orange [648] County. The Declaration provides that membership in the Association is mandatory for every fee owner of a lot in the development, and that every such member is subject to assessments by the Association “for the purpose of providing for and promoting the pleasure, recreation, health, safety and social welfare of the Members, including the enhancement of the value, desirability and attractiveness of the project….”

The Association is responsible for a broad catalogue of services to the community, including maintenance and landscaping of the common areas, such as pools, hot tubs, tennis courts, and utility facilities.

Another important function of the Association is to preserve the aesthetic quality and property values within the community. To this end, the Declaration contains an elaborate and detailed list of restrictions on the types of construction, improvements, landscaping and general activities which individual homeowners may install and engage in on their individual properties.

Article VII of the Declaration is concerned specifically with “Architectural and Landscaping Control” and contains 11 sections. Section 1 in pertinent part provides: “Architectural Approval. No fence, wall, building, sign or other structure (including basketball standards), or exterior addition to or change or alteration thereof (including painting) or landscaping, shall be commenced, constructed, erected, placed, altered, maintained or permitted to remain on the Project or any portion thereof, until plans and specifications shall have been submitted to and approved in writing by an architectural committee, initially to be appointed by the Declarant (the `Architectural Committee’)…. All such plans and specifications shall be in writing over the signature of the Owner of the property or such Owner’s authorized agent. Approval shall be based, among other things, on adequacy of site dimensions; adequacy of structural design and material; conformity and harmony of external design with neighboring structures; effect of location and use of improvements and landscaping on neighboring property,improvements, landscaping, operations and uses; relation of topography, grade and finished ground elevation of the property being improved to that of neighboring property; proper facing of main elevations with respect to nearby streets; preservation of view and aesthetic beauty with respect to fences, walls and landscaping; … and conformity of the plans and specifications to the purpose and general plan and intent of this Declaration. In any event, the Architectural Committee shall have the right, but not the obligation, to require any Member to remove, trim, top, or prune any shrub, tree, bush, plant or hedge which such Committee reasonably believes materially obstructs the view of any Lot. …” (Italics added.)

With regard specifically to fences, article VII, section 11 provides: “In the event that any Owner of a Lot within the Project wishes to install a fence [649] (`fence’) on his Lot in addition to complying with the other provisions of this Article, any such Owner shall also comply with the requirements of Exhibit `C’ attached hereto and incorporated herein by this reference, which Exhibit sets forth the specifications for any Fence. The location of any Fence shall be as determined by the Architectural Committee in its sole and absolute discretion; provided, however, that any Fence shall be located in such a fashion as to assure adequate access to adjacent real property in order that said real property may be maintained.” (Italics added.)

“Exhibit C” is a series of diagrams which both illustrate the type and dimensions of the fences which are approved for use in the project, and indicate where each fence may properly be located. Thus, “Sheet 1” of exhibit C (as amended) shows a solid slump block fence. The diagram specifies what type of block may be used, the dimensions of the blocks, and the maximum allowable height of the fence. This diagram is labeled “SLUMP BLOCK WALL @ SIDEYARD WITHOUT VIEW.” “Sheet 2” illustrates a second fence, this one consisting of a two-foot slump block foundation topped by a three-foot wrought iron bar section, for a total maximum height of five feet. Sheet 2 is labeled, “SLUMP BLOCK & WROUGHT IRON WALL @ REAR & SIDEYARD W/VIEW.”

As noted, the Declaration provides that all plans for any improvements must be submitted to the architectural committee. According to the Declaration, the Committee must consist of “not less than three nor more than five members.” The Committee is empowered, “in its sole discretion,” to amend the restrictions, or, “[w]here circumstances such as topography, location of property lines, location of trees, configuration of Lots, or other matters require, may … [allow] reasonable variances … provided … that all such variances [are] in keeping with the general plan for the improvement and development of the Project.”

The Association is charged, in the Declaration, with the broad affirmative duty of “administering and enforcing these covenants, conditions and restrictions.” The Declaration vests the Association with the equivalent means of enforcing its obligations, as well. Thus, article XVI, section 4, entitled “Enforcement,” provides that the association “shall have the right to enforce by proceedings at law or in equity all covenants, conditions, restrictions, easements, reservations, liens and charges now or hereafter imposed by the Declaration … including, without limitation, the right to prosecute a proceeding at law or in equity against the person or persons who have violated or are attempting to violate any of these covenants, conditions, restrictions … to enjoin or prevent them from doing so, to cause said violation to be remedied and/or to recover damages for said violation.”

[650] In addition to the affirmative duties recited above, the Declaration also contains several so-called “exculpatory” clauses. These clauses purport to absolve the Association from any affirmative duty to enforce any of the covenants, conditions and restrictions in the Declaration, and to immunize the Association from liability for any of its acts of malfeasance or nonfeasance. Thus, the concluding sentence of article VII, section 1 states: “The [Association] shall not be required to comply with any of the provisions of this Section 1.” Section 4 of the same article provides that the Association “shall (not) be liable in damages to anyone submitting plans or specifications to them for approval, or to any Owner of property affected by this Declaration by reason of mistake in judgment, negligence or nonfeasance arising out of or in connection with the approval or disapproval or failure to approve or disapprove any such plans or specifications, …” Moreover, just in case any doubt remained as to the intent to establish the Association’s immunity to suit, Article XVI, section 12 provides: “To the fullest extent permitted by law, neither the Board, any committees of the Association nor any member shall be liable to any Member or Owner or the Association for any damage, loss or prejudice suffered or claimed on account of any decision, approval or disapproval of plans or specifications (whether or not defective), course of action, act, omission, error, negligence or the like made in good faith within which such Board, committee, or persons reasonably believed to be the scope of their duties.”

Having set forth the relevant provisions in the Declaration, we now turn to the central legal issue, the nature and extent of the Association’s duty to plaintiffs with reference to the codefendants’ fence.

(1) It is a settled rule of law that homeowners’ associations must exercise their authority to approve or disapprove an individual homeowner’s construction or improvement plans in conformity with the declaration of covenants and restrictions, and in good faith. (Hannula v. Hacienda Homes (1949) 34 Cal.2d 442, 447 [211 P.2d 302, 19 A.L.R.2d 1268]; Branwell v. Kuhle (1960) 183 Cal. App.2d 767, 779 [183 Cal. Rptr. 767].) As the court in Hannula stated: “Each of the decisions enforcing like restrictions has held that the refusal to approve plans must be a reasonable determination made in good faith.” (Hannula v. Hacienda Homes, supra, 34 Cal.2d 442, 447.) The same requirement of good faith applies equally to the approval of plans. “The converse should likewise be true, … `[T]he power to approve plans … must not be exercised capriciously or arbitrarily.'” (Bramwell v. Kuhle, supra, 183 Cal. App.2d 767, 779; see also Norris v.Phillips (Colo. App. 1981) 626 P.2d 717, 719.)

(2) Furthermore, in recognition of the increasingly important role played by private homeowners’ associations in such public-service functions as maintenance and repair of public areas and utilities, street and common area lighting, sanitation and the regulation and enforcement of zoning ordinances, [651] the courts have recognized that such associations owe a fiduciary duty to their members. (See Raven’s Cove Townhomes, Inc. v. Knuppe Development Co. (1981) 114 Cal. App.3d 783, 799 [171 Cal. Rptr. 334].)

In a thoughtful article on Concepts of Liability in the Development and Administration of Condominium and Home Owners Associations (1976) 12 Wake Forest Law Review at page 915, the authors, Hyatt and Rhoads, note the increasingly “quasi-governmental” nature of the responsibilities of such associations: “The other essential role directly relates to the association’s regulatory powers; and upon analysis of the association’s functions, one clearly sees the association as a quasi-government entity paralleling in almost every case the powers, duties, and responsibilities of a municipal government. As a `mini-government,’ the association provides to its members, in almost every case, utility services, road maintenance, street and common area lighting, and refuse removal. In many cases, it also provides security services and various forms of communication within the community. There is, moreover, a clear analogy to the municipal police and public safety functions. All of these functions are financed through assessments or taxes levied upon the members of the community, with powers vested in the board of directors, council of co-owners, board of managers, or other similar body clearly analogous to the governing body of a municipality. Terminology varies from region to region; however, the duties and responsibilities remain the same.” (Id.,at p. 918, fns. omitted.)

As reflected by the law review article noted, membership in an association is usually mandatory. Such is true here. And the powers of such associations are extensive. “By his acceptance, the purchaser automatically becomes a member of the association created by the declaration and submits to the authority of the association and to the restrictions upon the use and enjoyment of the property contained in the declaration. Because each owner automatically becomes a member of the association upon taking title and because the association is empowered to levy and to collect assessments, to make and to enforce rules, and to permit or to deny certain uses of the property, the association has the power, and in many cases the obligation, to exert tremendous influence on the bundle of rights normally enjoyed as a concomitant part of fee simple ownership of property.” (Id., at p. 917.)

With power, of course, comes the potential for abuse. Therefore, the Association must be held to a high standard of responsibility: “The business and governmental aspects of the association and the association’s relationship to its members clearly give rise to a special sense of responsibility upon the officers and directors…. This special responsibility is manifested in the requirements of fiduciary duties and the requirements of due process, equal protection, and fair dealing.” (Id., at p. 921.) (See Raven’s Cove Townhomes, Inc. v. Knuppe Development Co., supra, 114 Cal. App.3d 783, 792-799.)

[652] The Kite Hill Community Association’s approval of a fence not in conformity with the Declaration is analogous to the administrative award of a zoning variance. In the zoning context as well as here, a departure from the master plan in the Declaration stands to affect most adversely those who hold rights in neighboring property. Hence, what the California Supreme Court has stated with regard to judicial review of grants of variances applies equally well to the Association’s actions herein: “[C]ourts must meaningfully review grants of variances in order to protect the interests of those who hold rights in property nearby the parcel for which a variance is sought. A zoning scheme, after all, is similar in some respects to a contract; each party foregoes rights to use its land as it wishes in return for the assurance that the use of neighboring property will be similarly restricted, the rationale being that such mutual restriction can enhance total community welfare. [Citations.] If the interest of these parties in preventing unjustified variance awards for neighboring land is not sufficiently protected, the consequence will be subversion of the critical reciprocity upon which zoning regulation rests.” (Topanga Assn. for a Scenic Community v. County of Los Angeles(1974) 11 Cal.3d 506, 517-518 [113 Cal. Rptr. 836, 522 P.2d 12].) For nearly identical reasons, we conclude that the courts must be available to protect neighboring property interests from arbitrary actions by homeowner associations.

(3) Thus, it follows that the trial court must review the Association’s decision approving the Ehles’ fence to insure that it was neither arbitrary nor in violation of the restrictions contained in the Declaration. (See cases cited in Annot., 40 A.L.R.3d 864.) Moreover, where the matter is up for review on appeal from a judgment of dismissal upon the sustaining of a demurrer, the standard of review is the same, i.e., to test as a matter of law whether the action of the Association could have been arbitrary. In our view, the complaint has succeeded in pleading this possibility, and a trial is necessary to determine if the Association action was in fact arbitrary.

(4) Turning to the next point, there is no merit in the Association’s argument that its duty of good faith extended only to its members as a group and not to its members individually. The Declaration expressly provides that the Committee’s approval of improvements “shall be based, among other things, on … [the] effect of location and use of improvements and landscaping on neighboring property, improvements, landscaping, operations and uses; …” (Italics added.)

The Association advanced the proposition (during oral argument) that the Committee’s approval of improvement plans could be “arbitrary” as to an individual homeowner, yet reasonable in light of the overriding interests of the community. Nonsense. Like any community, Kite Hill consists of individual members who form in the aggregate an organic whole. Thus, like any government, [653] the Association must balance individual interests against the general welfare. No decision of the Committee could possibly be deemed “arbitrary” as to an individual homeowner if it were based upon a superseding duty to the community at large. The Association’s duty of good faith subsumes an obligation to reconcile in a fair and equitable way the interests of the community with the interests of the individuals residing therein.

(5) Nor is there merit in the argument that a homeowner aggrieved by a decision of the Association with regard to a neighbor’s improvement should be limited to suit against that neighbor. As earlier noted, the covenants and restrictions create an affirmative duty on the part of the Association to protect individual homeowners affected by the improvement. More importantly, the Declaration clothes the Association with full authority to undertake all necessary legal actions to fulfill its protective duties.

Furthermore, it is apparent that but for the allegedly arbitrary approval by the Committee of the codefendant’s fence, plaintiffs might never have been forced to pursue a legal remedy in the first place.

Moreover, in any action by plaintiffs against their neighbors, the sole question for determination will be whether the actions of the architectural committee have been arbitrary. In an action to determine whether the Committee’s ruling was arbitrary or sound, the Association would obviously be a proper, if not an indispensable, party.

A nearly identical situation confronted the court in Norris v. Phillips, supra, 626 P.2d 717. Plaintiffs owned property adjacent to defendants’ in a residential community. Despite plaintiffs’ objections the architectural control committee approved defendants’ plan to construct a barn on their property. Plaintiffs filed suit against their neighbors as well as against the committee seeking to enjoin construction, but the committee was dismissed from the suit and the dismissal was not appealed. Plaintiffs prevailed at trial. The Court of Appeal reversed, holding that the trial court had failed to apply the correct standard in measuring the committee’s actions. “[T]he trial court’s determination of a breach of covenant, without a determination that the Architectural Control Committee acted unreasonably or in bad faith, was in error.” (Id., at p. 719.) Rather than remand for a determination using the proper standard of review, however, the Norris court reversed. They did so because the committee had earlier been dismissed. “In such a challenge, the Architectural Control Committee is an indispensable party. In that the architectural control committee was dismissed out of this suit and that dismissal has not been appealed, a remand for a determination that the committee acted unreasonably or in bad faith is not possible.” (Id., at p. 719, fn. 1.)

[654] Similarly, plaintiffs’ suit here turns on the good faith and lack of arbitrariness of the Committee’s approval, assessed in the light of all of the provisions of the Declaration. It appears from the record that the fence in question was not in conformity with the provisions of the Declaration, particularly the provisions contained in exhibit C, inasmuch as the codefendants placed a solid stone fence on a sideyard with a view, whereas exhibit C clearly requires a wrought iron open fence. Although the Declaration vests “sole discretion” in the Committee and allows for reasonable variances, their decisions must be “in keeping with the general plan for the improvement and development of the Project,” and of course, must be made in good faith and not be arbitrary. These are clearly questions of fact for a jury. Accordingly, the Association was a proper defendant in the action below, and dismissing it from the action was error.

B. The Effect of the Exculpatory Clauses

(6a) Notwithstanding the Association’s clear affirmative duty to act in good faith and to avoid arbitrary decisions in applying the covenants and restrictions, the question remains whether the exculpatory clauses effectively cancelled out that duty and thereby immunized the Association from suit. We conclude that they do not.

The law has traditionally viewed with disfavor attempts to secure insulation from one’s own negligence or wilful misconduct, and such provisions are strictly construed against the person relying on them, particularly where such person is their author. (Viotti v.Giomi (1964) 230 Cal. App.2d 730, 739 [41 Cal. Rptr. 345]; Sproul v. Cuddy (1955) 131 Cal. App.2d 85, 94-95 [280 P.2d 158]; Basin Oil Co. v. Baash-Ross Tool Co.(1954) 125 Cal. App.2d 578, 594-597 [271 P.2d 122].) Here, the Association is the creation and successor of the author, S & S Construction Company, and therefore subject to this rule of strict construction.

Furthermore, it is the express statutory policy of this state that “[a]ll contracts which have for their object, directly or indirectly, to exempt anyone from the responsibility for his own fraud or willful injury to the person or property of another, or violation of law, whether willful or negligent, are against the policy of the law.” (Civ. Code, § 1668.)

This public policy applies with added force when the exculpatory provision purports to immunize persons charged with a fiduciary duty from the consequences of betraying their trusts. (See Mitchell v. Dilbeck (1937) 10 Cal.2d 341 [74 P.2d 233]; Forbes v.McDonald (1879) 54 Cal. 98.)

(7) Moreover, the California Supreme Court has evinced a clear policy of enforcing only those exculpatory provisions which do not affect “the public interest.” [655] (Tunkl v.Regents of the University of California (1963) 60 Cal.2d 92, 96 [32 Cal. Rptr. 33, 383 P.2d 441, 6 A.L.R.3d 693].) Factors to be considered in determining whether a business or transaction affects a public interest include: (a) whether the matter is suitable for public regulation; (b) whether the party provides a service of importance to the public; (c) whether the party invoking it possesses a bargaining advantage against any member of the public who seeks such service; (d) and whether one party is particularly subject to the other’s control and the risk of his or her carelessness. (Id., at pp. 98-101.)

Applying one or more of these criteria, the courts have invalidated exculpatory clauses invoked by banks (Hiroshima v. Bank of Italy (1926) 78 Cal. App. 362 [248 P. 947];Vilner v. Crocker National Bank (1979) 89 Cal. App.3d 732 [152 Cal. Rptr. 850]), hospitals (Tunkl v. Regents of the University of California, supra, 60 Cal.2d 92;Westlake Community Hosp. v. Superior Court (1976) 17 Cal.3d 465 [131 Cal. Rptr. 90, 551 P.2d 410]), and apartment complexes (Henrioulle v. Marin Ventures, Inc. (1978) 20 Cal.3d 512 [143 Cal. Rptr. 247, 573 P.2d 465]).

(6b) For the reasons earlier stated, we view the Association of homeowners as occupying a particularly elevated position of trust because of the many interests it monitors and services it performs. Therefore, we hold that the exculpatory provisions contained in the Declaration constitute no bar to suit against the Association.

The arguments set forth by the Association merit little consideration. It argued most strenuously that the Declaration does not create an easement or equitable servitude giving plaintiffs the right to an unobstructed “view.” That is plainly not the issue here. The central question is whether the Association, under the Declaration, has a duty to act in good faith and avoid arbitrary decisions in approving the plans for construction of a fence on codefendants’ property.

(8) Nor are plaintiffs barred from filing suit because they are members of the Association, a nonprofit corporation. It is well settled that members may sue such entities for personal injuries. (9) Nor, finally, is the injunctive relief requested by plaintiffs inappropriate or impractical. It is well within the trial court’s power, if it determines that the architectural committee breached its duty, to order the Association to exercise its authority under the Declaration to compel compliance with the architectural standards set forth therein.

(6c) In sum, we hold that the Association in reviewing the codefendant’s improvement plan owed a fiduciary duty to plaintiffs to act in good faith and to avoid arbitrary action, and that there is an issue of fact raised by the pleadings [656] as to whether the Association did so. As a consequence, the demurrer was improperly sustained.

DISPOSITION

The judgment is reversed.

Morris, P.J., and Kaufman, J., concurred.

[FN. 1] On appeal, we deem the Association’s demurrer to have admitted all well-pleaded material facts. (Thompson v.County of Alameda (1980) 27 Cal.3d 741, 746 [167 Cal. Rptr. 70, 614 P.2d 728, 12 A.L.R. 4th 701].)

[FN. 2] Plaintiffs also named as defendants their other neighbors, the Lees, for construction of certain improvements without the approval of the Committee, as well as S & S Construction Company.

[FN. 3] Plaintiffs amended their complaint several times. The trial court sustained the Association’s demurrer to their fourth amended complaint.

COUNSEL

Horvitz & Levy, Barry R. Levy, Daniel J. Gonzalez; Musick, Peeler & Garrett and Gary L. Wollberg for Defendants and Appellants. David A. Niddrie; Garrison & McInnis, Donald E. McInnis and Robert R. Massey for Plaintiff and Respondent.

OPINION

[969]  O’ROURKE, J.

After the Board of Directors (the Board) of the Rancho Santa Fe Association (the Association), on the advice of a five-person “Art Jury,” rejected Patricia Dolan-King’s proposed plans for home additions and  [970] a perimeter fence on her property, Dolan-King sued the Association seeking a declaration that its actions were invalid. Following a bench trial, the court declared the Association’s rejection of the plans arbitrary and an “abuse of power” and entered judgment in Dolan-King’s favor. The Association appeals, claiming the court misinterpreted the protective covenant governing land use and aesthetic standards for Dolan-King’s property, improperly substituted its own judgment for that of the Association and Art Jury and failed to exercise the proper judicial deference for the Association’s aesthetic decisions.

We conclude the relevant provisions of the protective covenant are enforceable equitable servitudes, and, with regard to Dolan-King’s improvement applications, Dolan-King failed to meet her burden to show the Board’s decisions were unreasonable and arbitrary under the circumstances. Accordingly, we reverse the judgment and order and direct the court to enter judgment for the Association.

FACTUAL AND PROCEDURAL BACKGROUND

In 1996, Dolan-King purchased a home on an approximately three-acre lot in the residential community of Rancho Santa Fe. Development in Rancho Santa Fe is subject to the Rancho Santa Fe Protective Covenant (Covenant), which was adopted and recorded in 1928 and amended at various times over the years. Declaring that “Rancho Santa Fe is unusually attractive and valuable as a high class place of residence because of the rare quality of its landscape, trees and shrubs and the fine architecture and other improvements established by its property owners,” the Covenant recognizes the Rancho Santa Fe property owners’ desire of “preserving, continuing and maintaining the character of community and rare landscape features and of upholding the quality of all future architecture and improvements, and of restricting the use, height and bulk of buildings . . .” To that end, the Covenant not only contains express restrictions on such things as height requirements and building setbacks, but it also requires that property improvements and structures be approved by the Association with the written advice of the Rancho Santa Fe Art Jury (the Art Jury) “so as to insure a uniform and reasonably high standard of artistic result and attractiveness in exterior and physical appearance of said property and improvements.”[1] The Covenant charges the Association and the Art Jury with power to interpret and enforce its provisions.

[971]  Article IV of the Covenant establishes three “Architecture Districts” within Rancho Santa Fe, and sets forth general requirements to which buildings or structures “shall” conform, “subject to the discretion of the Art Jury.” Article IV, section 28, entitled “General Requirements as to Architecture,” PROVIDES: “To preserve the attractiveness of the said property and to prevent the erection, alteration or maintenance of buildings of undesirable and inharmonious design that would depreciate neighboring property, there are hereby established and defined for said property certain districts combining the usual architectural forms as follows: [P] Type I–Architecture Districts. [P] Type II–Architecture Districts. [P] Type III–Architecture Districts. . . . No building or structure shall be erected, constructed altered or maintained on said property or any part thereof, except in conformity with the regulations herein provided for the Type of Architecture District in which said building or structure is located. . . . [P] (c) Materials, color and forms must be used honestly, actually expressing what they are, and not imitating other materials (such as tin, tile, wood and sheet metal, shamming stone, etc.) . . . In this hilly country, roofs will be much seen from above, and their form and color are important to the success and attractiveness of the property. The design of the building must be such as will, in the opinion of the Art Jury, be reasonably appropriate to its site and harmonize with its surroundings. The word “type” is used rather than “style” because attempts to reproduce “archaeological” or “period” styles shall be discouraged.

Dolan-King’s home was within the Type I Architecture District, described in the Covenant as “that distinctive type of architecture which for several decades has been successfully developing in California, deriving its chief inspiration directly or indirectly from Latin types, which developed under similar climatic conditions along the Mediterranean or at points in California, such as Monterey.”

Dolan-King was drawn to Rancho Santa Fe because she “wanted to live in the Covenant.” She was aware of the Covenant’s existence and had “read over it” before she agreed to purchase the house. Dolan-King testified she liked the house and was “really excited” by the fact it was in the Covenant. However, she desired to make some changes, and through architects Dolan-King submitted to the Art Jury plans for a new perimeter fence as well as “turret-style” additions to her living and family rooms. In place of the original three-rail corral-type fence on her property when she purchased it,  [972]  she proposed a fence composed of stucco columns (pilasters) joined by horizontal wood beams. The proposed room addition structures were designed with large windows and French doors wrapped around their upper and lower levels to provide increased natural lighting as well as views north and east of her house.

The Art Jury denied Dolan-King’s applications. It found her proposed fence designs inconsistent with the Rancho Santa Fe Residential Design Guidelines (Guidelines),[2] the desired rural community character and the existing neighborhood character. It suggested, as an “aesthetic alternative” in response to Dolan-King’s concern about containing her pets, placing wire mesh on the inside face of the corral fence. As for Dolan-King’s proposed room additions, the Art Jury found the designs “not in keeping with Paragraph 46” of the Covenant. The Art Jury stated the turret-style additions would be acceptable if Dolan-King decreased the proportion of window to stucco mass[3] in a manner similar to examples presented to them by her architect, and suggested she reevaluate that as well as the thickness of the walls and size and quantity of the windows.

Following unsuccessful mediations attended by Dolan-King’s attorney and architect,[4] Dolan-King appealed the Art Jury’s decisions to the Board. The Covenant vests the Board with authority to modify the Art Jury’s decisions in cases where four-fifths of the Board finds the Art Jury’s decision “works an undue hardship” on the petitioner; modification of the Art Jury’s decision “will not tend unduly to lower the standards of attractiveness of the surrounding property or depreciate the neighborhood”; or there was “bias or prejudice on the part of one or more members of the Art Jury as to said decision or ruling.” The Board unanimously upheld the Art Jury’s decisions.

[973]  Dolan-King filed suit against the Association, its board of directors and the Art Jury seeking a judicial determination of the validity and enforceability of the Guidelines and the criteria and restrictions used by the Art Jury to reject her applications. She asked the court to resolve whether the Guidelines and various provisions of the Covenant were applied arbitrarily and unreasonably; whether the defendants’ land use planning was arbitrary, capricious and unreasonable; and whether the defendants exceeded their authority under the Covenant and breached their contractual and fiduciary duties to the Association’s members.

Following the presentation of evidence and written arguments, the court rendered its intended statement of decision in Dolan-King’s favor. It found the Association and Art Jury’s decisions rejecting her applications “failed the rational relationship test and constituted an abuse of power.” SPECIFICALLY, IT CONCLUDED: (1) Board approval of Dolan-King’s applications would not violate paragraph 46 of the Covenant, requiring that the Art Jury ensure “a uniform and reasonably high standard of artistic result and attractiveness, in exterior and physical  appearances” of the property and improvements; (2) Dolan-King’s fence plans should have been approved by the Art Jury and Board because (a) the proposed fence type was “consistent with the type of architecture required by the Covenant,” (b) the Board and Art Jury’s decisions were improperly based on Guidelines that were without “controlling effect,” and (c) the fence could be masked by appropriate landscaping; and (3) The Covenant required the Art Jury and Board to approve any fenestration plan “consistent with the required style of architecture that was not aesthetically displeasing,” and the turrets were not at all or barely visible from the street. After the Association unsuccessfully objected to the court’s intended statement of decision, the court deemed the intended statement of decision final and entered judgment for Dolan-King. It awarded Dolan-King attorney fees in the amount of $187,677.

DISCUSSION

I.          Standard of Review

We first address the proper standard for our review of the court’s judgment. The Association contends we must act “independently of the trial court” and review the Board and Art Jury’s decisions “in the light most favorable to the decision to deny approval,” giving deference to the Board’s decision analogous to review of decisions of governmental agencies on petition for writ of mandate. It urges we follow the “rule of judicial deference” to community association board decisionmaking set out by the California Supreme Court in Nahrstedt v. Lakeside Village Condominium [974] Assn. (1994) 8 Cal. 4th 361, 374 (Nahrstedt) and more recently in Lamden v. La Jolla Shores Clubdominium Homeowners Assn. (1999) 21 Cal. 4th 249, 253 (Lamden). Dolan-King relies upon Clark v. Rancho Santa Fe Assn. (1989) 216 Cal. App. 3d 606, 619 (Clark) to argue we must presume the court’s judgment to be correct, view the evidence in the light most favorable to the judgment and simply determine whether substantial evidence supports the trial court’s conclusions. However, as Dolan-King acknowledges, Clark differs from this case in that it involved a referee’s review of the Association’s denial of a subdivision proposal under a petition for writ of mandamus. (Id. at p. 613.)  The sole issue before the referee in Clark was whether substantial evidence supported the Association and Art Jury’s subjective conclusions about the adequacy of the proposal, not, as here, whether the Association acted under enforceable restrictions, beyond its authority or in a discriminatory manner. (Id. at p. 615.) It is settled that in reviewing a trial court’s ruling on a writ of mandate (Code Civ. Proc., § 1085), the appellate court is “ordinarily confined to an inquiry as to whether the findings and judgment of the trial court are supported by substantial evidence. [Citation.]” (Saathoff v. City of San Diego (1995) 35 Cal. App. 4th 697, 700.)

The standard does not apply where the facts below are undisputed. (Ibid.)

Dolan-King’s complaint was for declaratory relief. Whether a determination is proper in an action for declaratory relief is a matter within the trial court’s discretion and the court’s decision to grant or deny relief will not be disturbed on appeal unless it is clearly shown its discretion was abused. (Hannula v. Hacienda Homes (1949) 34 Cal. 2d 442, 448.) Here, however, the decisive underlying facts, primarily Dolan-King’s proposed designs and the Art Jury and Board’s actions, are undisputed. In such a case, in reviewing the propriety of the trial court’s decision, we are confronted with questions of law. (Ghirardo v. Antonioli (1994) 8 Cal. 4th 791, 799; Caloca v. County of San Diego (1999) 72 Cal. App. 4th 1209, 1217.) Moreover, to the extent our review of the court’s declaratory judgment involves an interpretation of the Covenant’s provisions, that too is a question of law we address de novo. (City of El Cajon v. El Cajon Police Officers’ Assn. (1996) 49 Cal. App. 4th 64, 71; Clark, supra, 216 Cal. App. 3d at pp. 618-619 [resolving as a matter of law whether the language of the Covenant permits the Association and Art Jury to use subjective criteria in judging property owners’ applications to improve their property].)

[975]

II.        Enforceability of the Provisions of the Covenant and Residential Design Guidelines

A.         The Covenant’s Provisions

The court framed the issues at trial as follows: “1.What type of perimeter fence can be legally required to be in compliance with the requirements of the [Covenant] and 2. What type of fenestration . . . on the two proposed turret additions can be legally required to be in compliance with the requirements of the Covenant?” Although it acknowledged Dolan-King sought a declaration of the validity of the criteria and Guidelines applied by the Art Jury and Board, the court did not directly address the enforceability of the Covenant’s provisions or the Guidelines relied upon by those entities in denying her applications. The determination was a necessary prerequisite to decide whether the Board exceeded its authority and acted reasonably, and the court erred by ignoring the issue. However, on this record, we may address the reasonableness of the relevant provisions as a matter of law. (See, e.g., Liebler v. Point Loma Tennis Club (1995) 40 Cal. App. 4th 1600.)

Interpreting and applying the language of Civil Code section 1354 [(now Civil Code section 5975)],[5] the California Supreme Court has made it clear that restrictions on the use of property contained in covenants recorded with the county recorder are “presumed to be reasonable and will be enforced uniformly against all residents of the common interest development unless the restriction is arbitrary, imposes burdens on the use of lands it affects that substantially outweigh the restriction’s benefits to the development’s residents, or violates a fundamental public policy.” (Nahrstedt, supra, 8 Cal. 4th at p. 386; Lamden, supra., 21 Cal. 4th at p. 263.) Such deference to the originating covenants, conditions and restrictions “‘protects the general expectations of condominium owners “that restrictions in place at the time they purchase their units will be enforceable.”’” (Lamden, supra, 21 Cal. 4th at p. 264.)  Restrictions are evaluated for reasonableness in light of “the restriction’s effect on the project as a whole,” not from the perspective of the individual homeowner. (Nahrstedt, supra, 8 Cal. 4th 361, 386; Liebler v. Point Loma Tennis Club, supra 40 Cal. App. 4th at pp. 1606, 1611.) Accordingly, courts do not conduct a case-by-case analysis of the restrictions to determine the effect on an individual homeowner; we must consider the reasonableness of the restrictions by looking at the goals and concerns of the entire development.

[976]  In her briefs before the trial court, Dolan-King did not challenge the Covenant’s broad governing provisions expressing an intent to preserve the value and attractiveness of Rancho Santa Fe, and giving the Art Jury and Association authority and duty to enforce and interpret the Covenant’s provisions. Rather, she contended the Guidelines followed by the Art Jury were not contained in the Covenant, and that paragraphs 46 and 47 of the Covenant did not empower the Art Jury to deny her applications, but only enabled it to exercise discretion in approving “color,” “texture and finish of plaster or exterior” and “roofing materials” under other provisions of the Covenant.

We reject Dolan-King’s narrow interpretation of the Covenant. This court held in Clark, supra, 216 Cal.App.3d 606, that reading the Covenant as a whole, the Art Jury and Board are empowered to render judgments on property improvement applications based upon subjective as well as objective criteria. (Id. at pp. 618-619.) We noted the Covenant’s stated goal of a “‘uniform and reasonably high standard of artistic result and attractiveness, in exterior and physical appearance of said property and improvement’” and its “purpose . . . as protecting the attractiveness and value of the area as ‘a high class place of residence.’” (Id. at p. 618.) Our decision in Clark recognized that the Covenant expressly grants the Association and Art Jury broad authority to apply standards that are inherently subjective and by their nature cannot be measured or quantified: “Necessarily, any such evaluations of a property owner’s proposal for compatibility with these desired environmental qualities must be done on a subjective basis, as ‘attractiveness’ and ‘artistry’ are, like beauty, well within the eye of the beholder. Such qualities have never been measurable or quantifiable.” (Id. at p. 619, fn. omitted.)

Implicit in our holding in Clark is that the Covenant’s grant of authority to the Art Jury to make subjective aesthetic judgments is not wholly arbitrary. A restriction is arbitrary when it bears “no rational relationship to the protection, preservation, operation or purpose of the affected land.” (Nahrstedt, supra, 8 Cal. 4th at p. 381.) It is clear even from Dolan-King’s own briefs and testimony that one of the desirable aspects of living “in the Covenant” is the concern and control exercised by the Association over style and presentation of the homes as well as the surrounding properties. Maintaining a consistent and harmonious neighborhood character, one that is architecturally and artistically pleasing, confers a benefit on the homeowners by maintaining the value of their properties. Given the Covenant’s unambiguous intent to ensure relatively consistent architectural styles and a valuable, aesthetically appealing, high quality neighborhood for the collective benefit of the Rancho Santa Fe homeowners, we conclude the Covenant’s grant of broad authority and discretion in the Art Jury to apply [977] subjective aesthetic criteria is reasonable. Nor do we find the Covenant’s provisions violative of fundamental public policy or disproportionately burdensome. (Id. at p. 382.) Thus, its general restrictive provisions, reviewed and agreed to by Dolan-King before she purchased her property, are enforceable equitable servitudes.  California and many other jurisdictions have long upheld such general covenants vesting broad discretion in homeowners associations or boards to grant or withhold consent to construction. (Palos Verdes Homes Assn. v. Rodman (1986) 182 Cal. App. 3d 324, 328, citing Hannula v. Hacienda Homes, Inc., supra, 34 Cal. 2d 442; Riss v. Angel (1997) 131 Wn.2d 612 [citing numerous cases].) This is so even when the covenants contain such broad, general approval standards as “‘“conformity and harmony of external design and general quality with the existing standards of the neighborhood”’” and “‘“location of the building with respect to topography and finished ground elevations”’” as long as the covenants clearly granted such discretion. (Riss v. Angel, supra, 934 P.2d at p. 677, citing Winslette v. Keeler (1964) 220 Ga. 100 [the only limitation on a grantor’s right to reject plans under such standards is that the right must be exercised reasonably and in good faith].)

B.         The Guidelines

We view the Guidelines differently.  There is no evidence Dolan-King had notice of the unrecorded Guidelines at the time she purchased her property.[6] Thus, we do not, nor does the Association ask us to, treat them as equitable servitudes. (Nahrstedt, supra, 8 Cal.4th at p. 375 [“Restrictions that do not meet the requirements of covenants running with the land may be enforceable as equitable servitudes provided the person bound by the restrictions had notice of their existence.”].) In Lamden, the court noted a distinction between originating covenants and “subsequently promulgated” unrecorded use restrictions, stating the factors justifying deference to founding covenants are not necessarily present when a court considers subsequent unrecorded community association board decisions. (Lamden, supra, 21 Cal.4th at p. 264.) In Nahrstedt, the court suggested that such unrecorded restrictions are not accorded a presumption of reasonableness, but are viewed under a straight reasonableness test “so as to ‘somewhat fetter the discretion of the board of directors.’” (Nahrstedt, supra, 8 Cal. 4th at p. 376, quoting Hidden Harbour Estates v. Basso (Fla.Dist.Ct.App. 1981) 393 So.2d 637, 640.) We understand this distinction to primarily impact the respective burdens of proof at trial.

[978] The Guidelines themselves do not purport to be strict restrictions on improvements or land use. They are intended to “disseminate[] the site and design standards which the community holds as necessary to preserve community character; articulate[] the policies and goals by which the Association judges and regulates land use; and give[] a clear indication of those site and design principles which increase the probability of the issuance of Association permits.” THEY STATE: “These are general guidelines, and the Art Jury and Association Board may exercise the full breadth of their discretion in considering any land use proposal. The Association has the express right under the Protective Covenant to evaluate land use and building applications by standards other than those contained herein.” As a further indication that the Guidelines themselves are not intended as regulations, the Guidelines separately list in an appendix the “regulations on building and land improvement” adopted by the Association.

While we recognize that the Guidelines are not equitable servitudes, we find nothing inherently unreasonable about the Guidelines in and of themselves. They are the Association’s attempt to give property owners guidance, by way of detailed examples and explanation, on the criteria used by the Art Jury and Board in reviewing proposed improvements and exercising their broad discretion under the Covenant. The Board’s desire to give property owners more concrete examples of how the Art Jury is likely to exercise its broad discretion is entirely legitimate and fair, even though the Guidelines are not binding restrictions. That Dolan-King lacked notice of the Guidelines does not affect their reasonableness, but may influence our determination of whether the Board fairly and reasonably relied upon them to deny Dolan-King’s fence application, which we address below.

III.       Validity of the Art Jury and Board’s Exercise of Discretion in Denying Dolan-King’s Applications

The Association contends the court erred by failing to exercise deference to the Board’s decisionmaking authority under Lamden, supra, 21 Cal. 4th at page 265 and in substituting its own judgment based upon its own evaluation of Dolan-King’s applications, including its conclusion Dolan-King’s room additions should have been approved because they were not “aesthetically displeasing.” According to the Association, as long as the record demonstrates a good faith and rational effort by the Board to further the purpose of the development, the court must uphold its decision. Dolan-King, on the other hand, argues the Board’s decisions are not entitled to deference under Lamden because the record shows they were made without reasonable investigation, in bad faith, and in disregard of the best interests of the community association and its members.  [979]

We agree the court failed to apply the proper deferential standard to test the Board’s exercise of discretion. In Lamden, the California Supreme Court held that courts should defer to the discretionary decisions of duly constituted community associations in exercising their obligations to maintain and repair common areas, where those decisions are made within the scope of their authority under relevant statutes, covenants, and restrictions, upon reasonable investigation, in good faith, and in a manner in the best interests of the Association and its members. (Lamden, supra, 21 Cal. 4th at p. 265.) The court in Lamden relied heavily upon its prior decision in Nahrstedt, which addressed the standards to be applied in enforcing recorded use restrictions that satisfy the requirements of equitable servitudes. In Nahrstedt, the court declared that an association must make findings of use restriction violations in “good faith, not in an arbitrary or capricious manner.” (Nahrstedt, supra, 8 Cal. 4th at p. 383.) It held: “Generally, courts will uphold decisions made by the governing board of an owner’s association so long as they represent good faith efforts to further the purposes of the common interest development, are consistent with the development’s governing documents, and comply with public policy.” (Id. at p. 374; see also Cohen v. Kite Hill Community Assn. (1983) 142 Cal.App.3d 642, 650 [“It is a settled rule of law that homeowners’ associations must exercise their authority to approve or disapprove an individual homeowner’s construction or improvement plans in conformity with the declaration of covenants and restrictions, and in good faith.”].)

Applying those standards here, it is clear that while the Covenant’s grant of discretionary decisionmaking authority to the Board and Art Jury is broad, it is not unbridled. Lamden’s rule of conditional judicial deference places limits upon how the Art Jury and Board may exercise their discretion in approving or rejecting improvement plans based on their subjective aesthetic judgment. Under those standards, where the record indicates the Art Jury and Board acted within the authority granted to it by the Covenant, pursuant to a reasonable investigation, in the best interests of the community and not in an arbitrary manner, we will respect and uphold their decisions. Having sought a declaration that the Art Jury and Board imposed restrictions unreasonably and arbitrarily, it was Dolan-King’s burden at trial to make that showing before the trial court. (Merkley v. Merkley (1939) 12 Cal. 2d 543, 547 [the plaintiff in a declaratory relief action has the burden to show the conditions exist that will justify the court in exercising its discretion to grant the relief sought].)

 A.         The Room Addition Proposal

Exercising its right to ensure a “uniform and reasonably high standard of artistic result and attractiveness” under paragraph 46 of the Covenant, the [980] Art Jury denied Dolan-King’s turret-style room addition proposals on the ground they were designed with an overabundance of glass (door and window). At trial, an Art Jury member testified the Art Jury had visited Dolan-King’s property, viewed the rear of her house, and compared the glass-to-stucco ratio of the rest of the house with that of the proposed additions. Initially, the Art Jury expressed dislike for the form (the turret shape) of the additions in relation to the rest of the house, but after considering Dolan-King’s architect’s presentation of Spanish Colonial Revival period architecture it eventually conceded the round turrets would be acceptable if the window-to-stucco mass were changed. The Art Jury’s ultimate decision was made after it reviewed her architect’s exhibits, discussed the proportion of stucco to window, the general architectural styles and compared the general Santa Barbara architectural style to Dolan-King’s plans. It is clear that in the Art Jury’s opinion, the proposed addition designs did not meet its aesthetic standards because the fenestration did not “harmonize” with the remainder of the residence, nor was it consistent with the style of architecture promoted by Dolan-King’s architect. The Art Jury communicated to Dolan-King their view that her additions would be acceptable if the designs were altered to decrease the window and door mass.

The Art Jury’s decision to reject Dolan-King’s room addition proposal was well within the scope of its authority under the Covenant, and, based upon its investigation and stated reasoning, was a reasonable and good faith effort to maintain architectural consistency with the remainder of her home as well as the neighborhood.  Dolan-King did not meet her burden to show otherwise. While Dolan-King pointed out several commercial buildings and homes with turret-shaped rooms in Rancho Santa Fe,[7] in our view they do not reflect the kind of inconsistency between the addition and the original structure as the Art Jury noted with regard to Dolan-King’s proposals.

The Board’s action upholding the Art Jury’s decision was also well within its discretion and authority. The Board is empowered to rely upon the Art Jury’s recommendation, which was based upon the Art Jury’s visits to the Dolan-King residence and discussions with her architect. Although Dolan-King faults the Board for failing to view her residence or otherwise “investigate” the matter, nothing in the Covenant requires the Board to conduct its own independent investigation.[8] We conclude the Board’s decision rejecting Dolan-King’s proposed additions was entitled to deference and the court, [981] relying upon an overly restrictive interpretation of the Covenant, abused its discretion in declaring it in excess of the Board’s authority and not rationally related to the Association’s purposes.

B.         The Fence Proposal

The court reached the following conclusions regarding Dolan-King’s fence application: It found the parties did not dispute Dolan-King’s home was of “Spanish Colonial Revival,” which was an acceptable type of type I architecture under the Covenant. It noted the Covenant was silent on the type of perimeter fence appropriate for the type I architectural district, but drew an inference that the Covenant required such a fence be consistent with the Santa Barbara/Monterey/Spanish Colonial Revival type of architecture. The court ruled that, from an aesthetic standpoint, the fence should be compatible with the architectural style of Dolan-King’s home and other existing fences. Moreover, the court ruled there were inconsistencies between the Covenant’s requirements and the Guidelines, but noted the parties agreed the Guidelines were not restrictive covenants and concluded the Covenant’s provisions controlled. It acknowledged Dolan-King’s architect’s testimony that her proposed fence design was beautiful from an artistic standpoint, and “consistent with the Spanish Colonial Revival type architecture required” by the Covenant. The architect testified the pasture-rail type fence, on the other hand, was inconsistent with the Covenant. Based upon these findings and conclusions, the court declared Dolan-King’s fence application should have been approved.

The court’s ruling was based upon an overly narrow interpretation of both the Covenant’s grant of authority to the Art Jury and Board and its scope of permissible architectural types for improvements in Rancho Santa Fe. As we have explained, the Art Jury and Board acted well within their power to render subjective, aesthetic judgments about Dolan-King’s fence design. The Art Jury had the discretion to base its decision on a finding that a particular improvement lacked “harmony” with the subject property and its surrounding neighborhood. The court found the Guidelines inconsistent with the Covenant’s provisions relating to architectural type, specifically, the court [982] decided the Guidelines’ stated preference for corral- or pasture-rail-type fences was contrary to the Spanish Colonial Revival type of architecture mentioned in the Covenant. We do not interpret the Covenant or the Guidelines so literally or restrictively. The Covenant does not mandate the use of structures falling within that particular style of architecture, nor does it purport to define or limit the design of perimeter walls or fences. Indeed, as the Association points out, the Covenant is not at all precise in its description of permissible architectural types. It refers to a distinctive type of architecture that derives its “chief inspiration” “directly or indirectly” from Spanish types found “along the Mediterranean or at points in California, such as Monterey.” The Covenant plainly rejects strict adherence to architectural styles. It provides: “The word ‘type’ is used rather than ‘style’ because attempts to reproduce ‘archeological’ or ‘period’ styles shall be discouraged.” The Covenant’s designation of architectural types is not only imprecise, but application of the architectural restriction is further “subject to the discretion of the Art Jury.”

The relevant inquiry, whether the Art Jury and Board properly exercised their broad discretion, was not directly addressed by the court. The court’s findings and conclusions did not establish that either the Art Jury or Board acted arbitrarily, without reasonable investigation or in bad faith in denying Dolan-King’s fence application. For example, the court made no finding as to the “rural character” or predominance of fence type within Dolan-King’s immediate neighborhood. It did not determine whether other similarly designed homes had pasture-rail fences, or fences with design aspects similar to those proposed by Dolan-King. It did not find that other homes having wrought iron or stucco fences were in neighborhoods with predominantly pasture-rail type fences.

Nor could the court have made these findings on the record before it. At trial, the president of the Board testified that nearly all of the fencing in Dolan-King’s neighborhood was pasture-rail-type fencing. A member of the Art Jury explained that one of the bases for the Art Jury’s denial of her fence was that its composition, namely the combination of wrought iron and pilasters, was “too urban” and too formal in relation to the character of the neighborhood. She recalled the type of fences in Dolan-King’s neighborhood was white pasture-rail, and there were no other fences with pilasters and wrought iron in the neighborhood. Dolan-King’s architect conceded there was “quite a bit” of pasture-rail fencing in Rancho Santa Fe, and that style of fencing was consistent with the California ranch style of architecture as well as the Rancho Santa Fe community. While Dolan-King demonstrated homes in Rancho Santa Fe having a mix of fences and walls ranging from solid stucco, wrought iron rail, combined brick and wrought iron, and layered [983] stone, the mere existence of varying fence styles within Rancho Santa Fe does not establish arbitrary action under the Covenant, which contains no specific design criteria or limitations for perimeter walls and fences. Dolan-King did not demonstrate that those homes with more formal fence styles were surrounded by others having pasture-rail fences or no fences at all.[9] When confronted with videotape of these differing walls, Dolan-King’s architect was unable to state where they were located in the community or describe the nature of the property they were located upon. In fact, he pointed out his opinions about the various fences were not given with a view towards the Rancho Santa Fe community as a whole.

We recognize the law requiring evenhanded application of use restrictions creates some tension with the discretionary authority granted to the Art Jury and Board. While aesthetic considerations have their place in the Covenant and there are no absolute standards to guide the Art Jury’s judgment and taste, we must point out if the evidence had showed the perimeter fences and walls within Dolan-King’s immediate neighborhood (in the Covenant’s jurisdiction) lacked consistency, Dolan-King’s proposed fence design would not be inappropriate because it would not be out of harmony with them. (See, e.g., Town & Country Estates Ass’n v. Slater (1987) 227 Mont. 489 [design review committee was vested with authority to reject house plans based upon standards of “harmony of external design, location and relation to surrounding structures and topography” which standards were not ambiguous per se, but where the development contained a “cacophony” of house styles, the committee’s disapproval of the property owner’s plans was unenforceable]; Ashelford v. Baltrusaitis (Mo.Ct.App. 1980) 600 S.W.2d 581, 588 [association’s rejection of home building plans was unreasonable in light of evidence that other homes in development had exposed foundations and roof pitch similar to the prospective home builders; “what has been considered reasonable for other lot owners in the subdivision cannot be unreasonable when proposed by defendants”].) On the record before us, however, we cannot find Dolan-King proved she was subjected to the Board’s selective and arbitrary exercise of discretion with respect to her fence proposal.

[984]

IV.       Attorney Fee Award

The Association appealed the court’s order granting Dolan-King an award of attorney fees under Civil Code section 1354, subdivision (f) [(now Civil Code section 5975)].[10] In light of our disposition, we reverse the court’s order granting Dolan-King’s motion for attorney fees and remand the matter to the superior court to determine entitlement to attorney fees under Civil Code section 1354, subdivision (f). (Heather Farms Homeowners Assn. v. Robinson (1994) 21 Cal.App.4th 1568.)

DISPOSITION

The judgment and order awarding attorney fees are reversed and the matter remanded for the superior court to enter judgment for the Association and determine entitlement to attorney fees under Civil Code section 1354, subdivision (f). The Association is to recover its costs on appeal.

Kremer, P. J., and Huffman, J., concurred.

A petition for a rehearing was denied July 20, 2000, and respondent’s petition for review by the Supreme Court was denied October 3, 2000. Mosk, J., was of the opinion that the petition should be granted.

_________________________________________________________________

[1] Article III of the Covenant sets forth the Art Jury’s duties and functions, which include approval of land development and subdivisions, “examination, correction, approval or rejection” of building plans and specifications, and approval of works of art. Specifically, paragraph 46, section 1, provides: “No part of the said property and/or of any property at any time within the jurisdiction of the Art Jury or of the Association shall be subdivided, laid out or improved by buildings, or structures, or its physical contours altered or changed, except in preparing land for orchard or farm use, except with the approval of the Association with the written advice of the Art Jury so as to insure a uniform and reasonably high standard of artistic result and attractiveness in exterior and physical appearance of said property and improvements.” The Association’s bylaws make clear that the Board’s approval of subdivisions and structures is invalid unless it has first received the written advice of the Art Jury.

[2] The Association’s board of directors adopted and published the Guidelines in June 1991 with a stated goal to “produce a Board-Adopted document, for use by builders, members, decisionmakers and staff, which will guide residential development so that future permit approvals will work to maintain the traditional character of Rancho Santa Fe . . . .” The Guidelines contain numerous specific examples and pictures of design principles that “increase the probability” of permit approval. For example, the Guidelines state that “APPROPRIATE FENCE TYPES ARE: two or three rail pasture style post and rail, peeler log and other pasture types which reflect the rural character of the community.” The Board acknowledged to homeowners that the Guidelines were not controlling, and that the Association had the right under the Covenant to evaluate land use and building applications by standards other than those contained in the Guidelines. The parties apparently stipulated the provisions of the Covenant controlled over those contained in the Guidelines.

[3] The arrangement, positioning and design of windows and doors in a building is referred to as “fenestration.” (Webster’s 10th Collegiate Dict. (1997) p. 429.)

[4] Dolan-King’s attorney attended the mediation over the fence design, at which he presented a revised design containing vertical wrought iron pickets and railing. The Art Jury rejected the revised proposal as too similar to the original proposal.

[5] Civil Code section 1354, subdivision (a) provides: “The covenants and restrictions in the declaration shall be enforceable equitable servitudes, unless unreasonable, and shall inure to the benefit of and bind all owners of separate interests in the development. Unless the declaration states otherwise, these servitudes may be enforced by any owner of a separate interest or by the association, or by both.”

[6] Dolan-King testified she was not aware of the existence of the Guidelines until after she submitted her plans to the Art Jury and her attorney purchased a copy of the Guidelines during the mediation over her fence.

[7] The court made no fact findings with regard to these buildings, to which we would defer.

[8] Section III of the Covenant address procedures and standards for appeals of the Art Jury’s decisions to the Association’s Board. It provides that at the appeal hearing, “the appellant and his witnesses shall be fully heard, the decision or ruling of the Art Jury appealed from shall be read and the members of the Art Jury and their officers shall be heard as to the reasons for making the decision or ruling appealed from. . . . After full hearing as aforesaid and due consideration the Board . . . shall have the power by affirmative vote of at least four-fifths of the entire membership of the said directors to modify said act, decision and/or ruling of the Art Jury; provided that said modification shall only be ordered in a case where the directors find that such decision or ruling of the Art Jury works an undue hardship upon said petitioner or that a modification of the decision or ruling of the Art Jury will not tend unduly to lower the standards of attractiveness of the surrounding property or depreciate the neighborhood, or that there was bias or prejudice on the part of one or more members of the Art Jury as to said decision or ruling.”

[9] Dolan-King did present evidence that in 1996, the Board approved a solid stucco wall for another property owner whose property bordered the edge of Rancho Santa Fe. That owner asked the Art Jury to approve his plans because his property was adjacent to a high traffic road and he and his family desired privacy and relief from traffic light and noise. But there was no evidence as to the character of that owner’s surrounding neighborhood or any other evidence that would tend to show arbitrariness, such as similarity between that owner’s home design and Dolan-King’s. She admits in her brief that the solid stucco wall north and adjacent to her property is not on land located within the Covenant’s jurisdiction.

[10] That section provides: “In any actions specified in subdivision (a) to enforce the governing documents, the prevailing party shall be awarded reasonable attorney’s fees and costs. Upon motion by any party for attorney’s fees and costs to be awarded to the prevailing party in these actions, the court, in determining the amount of the award, may consider a party’s refusal to participate in alternative dispute resolution prior to the filing of the action.” (Civ. Code, § 1354, subd. (f).)