THE CITY OF MIDDLETON, Plaintiff-Counterdefendant-Respondent-Cross Appellant,
COLEMAN HOMES, LLC, an Idaho limited liability company; WEST HIGHLANDS, LLC, an Idaho limited liability company; WEST HIGHLANDS SUBDIVISION HOMEOWNERS ASSOCIATION, INC., an Idaho corporation; WEST HIGHLANDS LAND DEVELOPMENT, LLC, an Idaho limited liability company, Defendants-Counterclaimants-Appellants-Cross Respondents.
Opinion No. 48
from the District Court of the Third Judicial District of the
State of Idaho, Canyon County. Hon. Christopher S. Nye,
judgment of the district court is affirmed.
Pursley LLP, Boise of Appellant. Bradley Dixon argued.
Borton-Lakey Law Offices, Meridian, for Respondents. Joseph
W. Borton argued.
BURDICK, CHIEF JUSTICE.
Homes, LLC, West Highlands, LLC, West Highlands Subdivision
Homeowner's Association, Inc., and West Highlands Land,
LLC (collectively, "Appellants") bring this appeal
from the Canyon County district court. Appellants entered
into two agreements with the City of Middleton (the
"City") regarding impact fees and public access
space for the West Highlands Ranch Subdivision (the
"Project") located in Middleton, Idaho. Soon
thereafter, Appellants asserted the agreements were invalid
and unenforceable. In response, the City sought a judgment
from the district court declaring the agreements valid and
enforceable. The parties eventually stipulated to the
validity of the agreements. Both sides filed motions for
summary judgment asking the district court to interpret the
agreements. The district court ultimately ordered Appellants
to designate 12.8 acres of land within the Project as public
access space and ruled that Appellants were obligated to
provide a financial guarantee, if necessary. Based on the
summary judgment order, the district court found the City to
be the prevailing party and awarded the City attorney fees
under Idaho Code section 12-120(3). Appellants appeal the
district court's prevailing party determination. The City
cross-appeals the district court's fee award and ruling
that Appellants are obligated to provide a financial
guarantee, if necessary.
FACTUAL AND PROCEDURAL BACKGROUND
2006, the City approved the Project's annexation, zoning,
and preliminary plat. Appellants are four entities involved
with the Project. Coleman Homes, LLC ("Coleman") is
the developer who constructs and markets new homes within the
Project. West Highlands, LLC ("West Highlands") is
part owner of the land within the Project. West Highlands
Subdivision Homeowner's Association, Inc. ("West
Highlands Association") is the active homeowners'
association charged with maintaining and managing the
Project. West Highlands Land Development, LLC ("West
Highlands Land") is also part owner of the land within
economic conditions in January 2009, progress on the Project
slowed, and Thomas Coleman, owner of Coleman, sent a
subsequent application to the City requesting modifications
to the Project. In this correspondence, Mr. Coleman proposed
that Coleman make certain park improvements, including
"approximately 15.1 acres of individual parks with
amenities" that would remain open for public use but be
owned and maintained by West Highlands Association. The City
approved the subsequent application in May of 2009.
the City originally approved the Project in 2006, the City
did not have an impact fee ordinance. When the City approved
the modifications to the Project in May of 2009, the City
still did not have an impact fee ordinance. The City first
adopted an impact fee ordinance in July of 2009-Ordinance
447. However, Ordinance 447 was repealed in July 2012. In the
years between Ordinance 447's adoption and repeal, the
City and Appellants worked toward a resolution regarding
impact fees. These negotiations eventually led to the
executing and recording of two agreements: the West Highlands
Impact Fee Agreement and the Parks Dedication Agreement
West Highlands Impact Fee Agreement ("IFA") was
executed between the City, West Highlands, and Coleman. For
purposes of this appeal, the relevant language of the IFA
4.3 Notwithstanding the above, in accordance
with Idaho Code Section 67-8215(2), Developer [Coleman] shall
not be subject to development impact fees or credits thereof
subsequently adopted by the City for portions of the
development where construction has commenced and is pursued
according to the terms of the permit or development approval.
. . . .
3. Financial Guarantee. In
the event that Developer applies for building permits before
completion of the equivalent service level of Parks and
Streets, Developer shall provide one or more financial
guarantees, the form of which shall be approved by the City,
for Parks and Streets yet to be completed. . . . .
6. Attorneys' Fees and
Costs. . . . In the event a suit or action is filed
by either party against the other to interpret or enforce
this Agreement, the unsuccessful party to such litigation
agrees to pay to the prevailing party all costs and expenses,
including attorneys' fees incurred therein, including the
same with respect to an appeal.
the IFA was an agreement that the City would not impose
impact fees adopted in the future against Coleman and West
Highlands for the Project.
Parks Dedication Agreement ("PDA") was executed
between the City and West Highlands Association. The PDA
ensured that areas within the Project would remain open to
the public but were to be maintained and managed by West
Highlands Association. For purposes of this appeal, the
relevant language of the PDA states: "[t]he park lands
in the Community subject to this Agreement shall be those
park lands, constituting approximately 12.80 acres . . .
." The PDA, like the IFA, also mentions attorney fees.
In that regard, paragraph nine of the PDA states: "Any
dispute pertaining to the performance, interpretation or
enforcement of this Agreement shall be subject to mediation.
. . . The Parties shall share the mediator's fee and
other costs of the mediation fees equally; provided, however,
each Party shall bear its own legal fees."
repealing Ordinance 447, the City adopted a new impact fee
ordinance in 2015- Ordinance 541. The validity of the
Agreements came into question at that time and the City
sought declaratory relief that the Agreements were, in fact,
valid and enforceable. The City began collecting impact fees
from Appellants after Appellants repeatedly denied the
enforceability of the Agreements. On March 1, 2016, Appellants
amended their original answer and conceded the validity of
the Agreements. The district court entered an order on April
21, 2016, declaring the Agreements were valid and
enforceable. The City returned all fees collected during the
course of this initial litigation to Appellants on April 22,
parties then filed cross-motions for summary judgment asking
the district court to interpret the Agreements. Appellants
argued the Project was responsible for 6.92 acres of public
access space under the PDA. Conversely, the City argued the
Project was responsible for 15.1 acres of public access space
under the PDA. The district court found the terms of the PDA
were plain and unambiguous; the Project was responsible for
12.8 acres of public access space. The district court ordered
Coleman to develop and designate 12.8 acres of land within
the Project as open space available to the public and such
space was to be owned, maintained, and operated by West
Highlands Association. Additionally, the court ordered that
"Coleman must provide one or more financial guarantees
if Coleman applie[d] for building permits before completi[ng]
the equivalent service level of parks and streets."
judgment was signed by the district court judge on November
2, 2016, and filed by the clerk on November 7, 2016. Both
sides filed petitions for attorney fees and costs. The City
and Appellants both sought to enforce the IFA in regards to
attorney fees, but neither cited the PDA. The City's
attorney fees amounted to $37, 397.55. Appellants'
attorney fees amounted to $120, 847.50. Appellants moved to
strike the City's petition for attorney fees and costs
alleging the petition was untimely filed and served, but that
motion was denied.
district court ultimately found the City to be the prevailing
party and awarded attorney fees, in the amount of $28,
048.17, under Idaho Code section 12-120(3). Appellants timely
appealed the district court's prevailing party
determination and the district court's finding that the
City's petition for attorney fees was timely served and
filed. The City cross-appealed the district court's
attorney fees award and a purported clerical error in the
second amended judgment listing West Highlands as the party
obligated to provide a financial guarantee, as opposed to
II. ISSUES ON APPEAL
1. Whether the district court abused its discretion in
declaring the City the prevailing party.
2. Whether the district court's finding that the
City's petition for attorney fees and costs was timely
filed and served is based on substantial and competent
3. Whether the district court abused its discretion in
awarding the City attorney fees in the amount of $28, 048.17.
4. Whether the district court erred in the second amended
judgment by ruling that West Highlands, LLC was obligated to
provide the City a "financial guarantee."
Whether Appellants or the City are entitled to attorney fees
The district court did not abuse its discretion in declaring
the City the prevailing party.
prevailing party determination is within the "sound
discretion of the district court and will not be disturbed
absent an abuse of discretion." Oakes v. Boise Heart
Clinic Physicians, PLLC, 152 Idaho 540, 542,
272 P.3d 512, 514 (2012) (citing Jorgensen v.
Coppedge, 148 Idaho 536, 538, 224 P.3d 1125, 1127
When examining whether a district court abused its
discretion, this Court considers whether the district court:
(1) perceived the issue as one of discretion; (2) acted
within the outer boundaries of that discretion and
consistently within the applicable legal ...