Lodge at Westgate v. Westgate Resorts , 440 P.3d 793 ( 2019 )

2019 UT App 36THE UTAH COURT OF APPEALS
THE LODGE AT WESTGATE PARK CITY RESORT AND SPA
CONDOMINIUM ASSOCIATION INC.,
Appellee and Cross-appellant,
v.
WESTGATE RESORTS LTD. AND CFI RESORTS MANAGEMENT INC.,
Appellants and Cross-appellees.
Opinion
No. 20170544-CA
Filed March 14, 2019
Third District Court, Silver Summit Department
The Honorable Kara Pettit
No. 130500585
Michael A. Gehret, Michael E. Marder, and
Katheryn G. Saft, Attorneys for Appellants and
Cross-appellees
Ronald G. Russell, Matthew J. Ball, Phillip S.
Ferguson, Rebecca L. Hill, and Stephen D. Kelson,
Attorneys for Appellee and Cross-appellant
JUDGE KATE APPLEBY authored this Opinion, in which
JUDGES GREGORY K. ORME and DIANA HAGEN concurred.
APPLEBY, Judge:
¶1 Westgate Resorts Ltd. and CFI Resorts Management Inc.
(collectively, Westgate) appeal the district court’s ruling that a
document outside the “Declaration of Condominium and
Declaration of Covenants, Conditions and Restrictions” (the
Declaration) for the condominium was enforceable under the
doctrines of promissory estoppel and ratification. The Lodge at
Westgate Park City Resort and Spa Condominium Association
Inc. (the Association) appeals the district court’s determination
Lodge at Westgate v. Westgate Resorts
that the term “Common Areas and Facilities” under the
Declaration is limited to the building’s foundation. We affirm.
BACKGROUND
¶2 Westgate is the developer of a resort in Park City, Utah.
The resort includes timeshare units as well as whole ownership
units. Construction of the whole ownership portion began in
2006 and is known as the Lodge at Westgate Park City Resort
& Spa (the Project).
¶3 Westgate started selling condominium units at the Project
before construction commenced. The parties do not dispute that
“prospective purchasers received [a] draft [of] [the Declaration],
the Purchase & Sale Agreement, the Bylaws of the Association,
the Association’s Articles of Incorporation, and an estimated
budget for assessments for 2007.” 1
¶4 The Purchase & Sale Agreement informed purchasers that
the Project was in a pre-construction phase, stating “the buyer
acknowledges that the seller has disclosed to the buyer that a
final subdivision map for the condominium has not yet been
approved and recorded.” The Purchase & Sale Agreement
further disclosed that “the budget was only an estimate and that
actual costs for the line items were subject to change.” The
Declaration was recorded in 2007.
¶5 The Project was completed in 2008. The 2009 budget was
the first to be prepared for the Project in its fully operational
form. The proposed 2009 budget was substantially higher than
the 2007 estimated budget and the 2008 budget. 2 By this time,
condominium sales had mostly come to a stop due to the
1. The estimated budget in 2007 totaled $1,376,208.
2. The 2009 budget totaled $2,251,660.
20170544-CA 2 2019 UT App 36Lodge at Westgate v. Westgate Resorts
collapsed national economy. Many owners were upset by the
proposed 2009 budget. “More than 40 owners called and/or
emailed the Resort’s General Manager [(General Manager)] and
members of his team . . . expressing their dissatisfaction with
and rejection of the proposed budget.” “The predominant
sentiment of the owners was to try to work out a solution with
Westgate rather than pursue litigation, although litigation was
definitely an option for many of the owners.” Some owners met
with attorneys to explore legal alternatives. A group of owners
retained counsel and threatened legal action against Westgate.
The Chief Operating Officer (COO) of Westgate was aware of
these threats.
¶6 Dissatisfaction among the owners caused General
Manager to set up a “conference call with all interested owners
to explore solutions to the problems created by the proposed
2009 budget.” During the conference call, General Manager
requested that the owners establish a group which became
known as the Owners Finance Committee (the OFC). The OFC’s
purpose “was to work with Westgate to achieve a mutual
agreement between the developer and the homeowner[s] with
regards to the budget . . . start[ing] with cost allocation
methodologies and continu[ing] to the HOA fee.” General
Manager notified COO about the OFC and of his efforts to
resolve the budget concerns with the OFC. COO expressed his
approval of the committee and “encouraged an on-going
dialogue between Westgate and the OFC.” Neither Westgate nor
any of the owners objected to the formation or composition of
the OFC.
¶7 Over the next five months, the OFC and Westgate met
“essentially weekly” to work on a compromise budget and
methodology. Throughout the process the OFC reported its
progress to General Manager and solicited feedback from the
owners. General Manager also reported the progress to
Westgate’s senior management (including COO). During the
negotiations, the OFC requested to meet with COO to discuss
various issues with the proposed 2009 budget. Before the
20170544-CA 3 2019 UT App 36Lodge at Westgate v. Westgate Resorts
meeting, General Manager provided COO with a summary of
his meetings with the OFC, including the issues they had
resolved. General Manager told COO that “he had been able to
forestall a class action lawsuit by forming the OFC and working
with it in good faith to resolve the budget crisis.” COO met with
several members of the OFC in July 2009.
¶8 On November 6, 2009, General Manager sent a letter to all
the owners and Westgate stating that there were still some issues
to be resolved. It stated that “[t]he methodology outlined in the
[Budget] exhibits applies to all future budget preparation and
will be the guideline on how we decide on expenses moving
forward on the 2010 budget and thereafter.” The letter also
stated “[t]here may be some inconsistencies in various
condominium documents but the [Budget] exhibits take
precedent over those for the associated budget items.” Around
November 19, 2009, one of the members of the OFC sent an
amended budget document to General Manager. He responded
by email, stating it “looked great and it look[ed] like everything
[was] covered as discussed.”
¶9 The OFC met with General Manager on November 23,
2009, and General Manager signed each page of the finalized
budget document (the 2009 Budget Methodology). The district
court’s findings of fact stated, “Westgate . . . and the OFC
understood that the [2009 Budget Methodology] was
inconsistent with the [Declaration] in many particulars. That is
why [the November 6, 2009 letter] stated that the [2009 Budget
Methodology] took precedence over the inconsistent provisions
in the Declaration.”
¶10 The 2009 Budget Methodology determined the Project’s
budgets for the next four years. During these years, Westgate
never disavowed the November 6, 2009 letter and did not inform
the OFC or the owners that the 2009 Budget Methodology was
invalid.
20170544-CA 4 2019 UT App 36Lodge at Westgate v. Westgate Resorts
¶11 Throughout the negotiation process up to the date the
2009 Budget Methodology was signed, “Westgate was aware
that several condominium owners had consulted or were
continuing to consult counsel” regarding the increased proposed
budget. But once the 2009 Budget Methodology went into effect,
not a single owner filed a lawsuit against Westgate. The owners
relied on the 2009 Budget Methodology and, with this reliance,
let the statutes of limitation lapse on their various claims. The
owners also paid their retroactive assessments to Westgate for
the years 2009 to 2013 in reliance on the 2009 Budget
Methodology.
¶12 Around 2013, a fresh dispute arose between Westgate and
the owners after new management took over operation of the
resort. The dispute began because the budget for 2013 deviated
from the 2009 Budget Methodology in a number of ways. 3 The
Association filed a lawsuit against Westgate and Westgate
counterclaimed. Westgate and the Association each filed cross-
motions for a preliminary injunction. The court held a hearing
on the motions and ordered the parties to abide by the 2009
Budget Methodology during the pendency of the litigation.
¶13 After a bench trial, the district court issued findings of fact
and conclusions of law and ruled that the 2009 Budget
Methodology was enforceable under the doctrines of promissory
estoppel and ratification. 4 The parties moved to amend and
clarify the findings of fact and conclusions of law, and the court
amended its findings. A final judgment was entered in 2017 and
each side appealed.
3. This included an increase in the “Amenity Use Fee,” which is
discussed in connection with our review of the cross-appeal. See
infra Part III.
4. The court also made additional findings with respect to the
cross-appeal that are discussed in more detail below. See infra
Part III.
20170544-CA 5 2019 UT App 36Lodge at Westgate v. Westgate Resorts
ISSUES AND STANDARDS OF REVIEW
¶14 We address two of the issues Westgate raises on appeal. 5
First, Westgate argues the Association does not have standing to
5. Westgate raised three other issues we decline to address. First,
Westgate challenges the district court’s determination that the
2009 Budget Methodology “is enforceable under the principle of
ratification even though [the court] found that [Westgate’s
General Manager] lacked authority” to ratify the 2009 Budget
Methodology and “neither Westgate nor the owners received a
copy of the [2009 Budget Methodology].” We decline to address
this argument because Westgate failed to preserve it below and
failed to argue on appeal that an exception to the preservation
requirement applies. See Blanch v. Farrell, 2018 UT App 172, ¶ 17
(“This court generally will not consider an issue on appeal
unless it has been preserved or the appellant asserts that a valid
exception to the preservation rule applies.”). Westgate argues
that it “had no opportunity to address” the ratification issue
because it “was never part of the pleadings,” “was not litigated
at trial,” and “was raised for the first time in [the Association’s]
closing argument (which was after post-trial briefing).” But after
reviewing the record, we conclude Westgate had multiple
opportunities to challenge ratification as an inappropriate basis
on which to enforce the 2009 Budget Methodology. Westgate
failed to “specifically” challenge the issue “in a timely manner”
and support the challenge with “evidence and relevant legal
authority.” Id. (quotation simplified).
Second, Westgate argues for the first time on appeal that
the district court erred in concluding “that the 2009 Budget
Methodology would control over any inconsistencies in the
Shared Use Agreement or the Declaration because it essentially
acts as an amendment to both the Shared Use Agreement and
Declaration without following the proper procedures for a
formal amendment.” Westgate also challenges this conclusion on
the basis that “the Utah Condominium Ownership Act requires
that any amendments to a condominium declaration be recorded
(continued…)
20170544-CA 6 2019 UT App 36Lodge at Westgate v. Westgate Resorts
seek enforcement of the 2009 Budget Methodology because the
court determined “that the owners, not the Association, relied
upon Westgate’s promise and ratified Westgate’s conduct.”
“Whether a party has standing is primarily a question of law,
which we review for correctness.” Edwards v. Powder Mountain
Water and Sewer, 2009 UT App 185, ¶ 10, 214 P.3d 120.
¶15 Second, it contends the facts of the case preclude the
district court from enforcing the 2009 Budget Methodology
(…continued)
to be valid.” See Utah Code Ann. § 57-8-12 (LexisNexis 2010)
(stating “[n]either the declaration nor any amendment thereof
shall be valid unless recorded”). After reviewing the record, we
conclude neither of these arguments were preserved. Westgate
never challenged the district court’s finding under the statute
nor did it argue that promissory estoppel and ratification were
improper means for enforcing the 2009 Budget Methodology.
Westgate only argued that the elements of promissory estoppel
were not met in this case.
Finally, Westgate contends the district court erred when it
“fail[ed] to award Westgate damages for the Association’s
underpayment of the Shared Amenities Fee after the [court]
concluded that the Shared Amenities Fee was not capped by the
2009 Budget Methodology.” On appeal, the appellant “must
explain, with reasoned analysis supported by citations to legal
authority and the record, why the party should prevail on
appeal.” Utah R. App. P. 24(a)(8); see also Bank of Am. v. Adamson,
2017 UT 2, ¶¶ 12–13, 391 P.3d 196 (explaining that there is no
“bright-line rule determining when a brief is inadequate,” but
“[a]n appellant that fails to devote adequate attention to an
issue” and fails to “cite the legal authority on which its argument
is based” is “almost certainly going to fail to meet its burden of
persuasion” (quotation simplified)). Westgate failed to support
its argument on this issue with any citation to legal authority.
We decline to address this argument because it is inadequately
briefed.
20170544-CA 7 2019 UT App 36Lodge at Westgate v. Westgate Resorts
under the doctrine of promissory estoppel. Promissory estoppel
is a doctrine of equitable relief, which presents “mixed questions
of fact and law.” Richards v. Brown, 2009 UT App 315, ¶ 11, 222
P.3d 69 (quotation simplified). We therefore review the district
court’s factual findings for clear error and its legal conclusions
for correctness. Id.¶16 The Association raises three issues in its cross-appeal.
First, it contends the district court erred “by interpreting the
Declaration to limit the [Condominium’s] common areas and
facilities to [the Project’s] foundation contrary to the
Declaration’s own provisions and the Utah Condominium
Ownership Act.”
¶17 Second, the Association contends the district court “erred
by ignoring the evidence that the parties to [the 2009 Budget
Methodology] intended all budget categories, including the
amenities use fee, to be subject to a future increase[] clause, and
by reducing damages awarded to the [Association] for excess
fees charged by Westgate.” “We interpret the provisions of the
Declaration as we would a contract.” B. Investment LC v.
Anderson, 2012 UT App 24, ¶ 9, 270 P.3d 548 (quotation
simplified). “The interpretation of a contract is a question of law,
which we review for correctness, giving no deference to the
ruling of the district court.” Salt Lake City Corp. v. Big Ditch
Irrigation Co., 2011 UT 33, ¶ 19, 258 P.3d 539. “Likewise, the
determination of whether a contract is facially ambiguous is a
question of law, which we review for correctness.” McNeil Eng’g
& Land Surveying, LLC v. Bennett, 2011 UT App 423, ¶ 7, 268 P.3d
854. And we “resolve questions of facial ambiguity in a contract
according to the parties’ intent, which is a question of fact.” Id.“If the contract is ambiguous and the [district] court makes
findings regarding the intent of the parties, we will not disturb
those findings unless they are clearly erroneous.” Allstate Enters.,
Inc. v. Heriford, 772 P.2d 466, 468 (Utah Ct. App. 1989).
¶18 Finally, the Association argues the district court “erred by
declining to adopt certain features of the Association’s proposed
20170544-CA 8 2019 UT App 36Lodge at Westgate v. Westgate Resorts
Final Judgment and Order based on a determination that [it] did
not comply with Rule 58A” of the Utah Rules of Civil Procedure.
“We review the [district] court’s interpretation of a rule of civil
procedure for correctness.” Solis v. Burningham Enters. Inc., 2015
UT App 11, ¶ 11, 342 P.3d 812.
ANALYSIS
I. Standing
¶19 Westgate challenges the district court’s enforcement of the
2009 Budget Methodology by arguing that the owners, not the
Association, relied on Westgate’s promises. According to
Westgate, this creates a “standing problem.”
¶20 “Utah standing law operates as a gatekeeper to the
courthouse, allowing in only those cases that are fit for judicial
resolution.” Utah Chapter of Sierra Club v. Utah Air Quality Bd.,
2006 UT 74, ¶ 17, 148 P.3d 960 (quotation simplified). It is a
“jurisdictional requirement that must be satisfied before a court
may entertain a controversy between two parties.” Packer v. Utah
Att’y Gen.’s Office, 2013 UT App 194, ¶ 8, 307 P.3d 704 (quotation
simplified). The traditional test for standing requires a party to
“allege that he or she has suffered or will imminently suffer an
injury that is fairly traceable to the conduct at issue such that a
favorable decision is likely to redress the injury.” Chen v. Stewart,
2005 UT 68, ¶ 50, 123 P.3d 416 (quotation simplified).
¶21 Traditional standing doctrines aside, Utah law specifically
allows homeowners’ associations (HOAs) to bring claims on
behalf of their members even when the HOA does not
experience a direct injury. Utah Code Ann. § 57-8-33 (LexisNexis
2010). The statute states,
Without limiting the rights of any unit owner,
actions may be brought by the manager or
management committee . . . on behalf of two or
20170544-CA 9 2019 UT App 36Lodge at Westgate v. Westgate Resorts
more unit owners . . . with respect to any cause of
action relating to the common areas and facilities
or more than one unit.
Id. This statute “expressly reserves the rights of the unit owners”
while also allowing “representation by the management
committee on behalf of two or more unit owners.” Brickyard
Homeowners’ Ass’n Mgmt. Comm. v. Gibbons Realty Co., 668 P.2d
535, 538 (Utah 1983) superseded on other grounds by constitutional
amendment as stated in Brown v. Cox, 2017 UT 3, 387 P.3d 1040.
Under the statute, the lawsuit brought by an HOA must also
“relate to the common areas and facilities or more than one
unit.” Id. at 541.
¶22 Here, the Association brought suit on behalf of “two or
more unit owners.” Utah Code Ann. § 57-8-33 (LexisNexis 2010).
The lawsuit also concerns “common areas and facilities or more
than one unit.” Id. Based on the record and the arguments
presented, the Association has standing under the statute to sue
on behalf of the owners. 6 Id.
6. In its reply brief, Westgate makes two unpersuasive
arguments why the statute is inapplicable in this case. First,
Westgate argues that the Association is not a “management
committee” under the statute because the Association only has
the power to maintain common areas and facilities, not the
property. See Utah Code Ann. § 57-8-3(20) (LexisNexis 2010).
Second, Westgate argues the statute is inapplicable because this
lawsuit arose out of a dispute over a budget document not
“common areas or units.” These conclusory statements do not
adequately articulate why the statute does not apply here. An
issue is inadequately briefed when it “merely contains bald
citations to authority without development of that authority and
reasoned analysis based on that authority.” Bank of Am. v.
Adamson, 2017 UT 2, ¶ 11, 391 P.3d 196 (quotation simplified).
(continued…)
20170544-CA 10 2019 UT App 36Lodge at Westgate v. Westgate Resorts
II. Promissory Estoppel
¶23 Westgate contends the district court erred when it
“concluded that the Association was entitled to a declaration
that the terms of the 2009 Budget Methodology are enforceable
under the doctrine of promissory estoppel.”
¶24 Promissory estoppel is “employed where injustice can be
avoided only by the enforcement of the promise.” Hess v.
Johnston, 2007 UT App 213, ¶ 22, 163 P.3d 747. The elements of
promissory estoppel are:
(1) the plaintiff acted with prudence and in
reasonable reliance on a promise made by the
defendant; (2) the defendant knew that the plaintiff
had relied on the promise which the defendant
should reasonably expect to induce action or
forbearance on the part of the plaintiff or a third
person; (3) the defendant was aware of all material
facts; and (4) the plaintiff relied on the promise and
the reliance resulted in a loss to the plaintiff.
Youngblood v. Auto-Owners Ins. Co., 2007 UT 28, ¶ 16, 158 P.3d
1088 (quotation simplified).
¶25 Westgate challenges the finding of promissory estoppel
on two grounds. First, it argues promissory estoppel cannot
(…continued)
Appellate courts “are not a depository in which the appealing
party may dump the burden of argument and research.” Id.(quotation simplified). Westgate does not provide reasoned
analysis why the Association is the improper party to bring the
lawsuit and why the 2009 Budget Methodology does not relate
to common areas and facilities or more than one unit under the
statute.
20170544-CA 11 2019 UT App 36Lodge at Westgate v. Westgate Resorts
apply because the promise in this case was too indefinite and
lacked the essential terms to create a binding agreement. Second,
it argues promissory estoppel cannot apply because the owners
did not reasonably rely on the promise.
A. Clear and Definite Promise
¶26 “Promissory estoppel involves a clear and definite
promise.” Mitchell v. ReconTrust Co., 2016 UT App 88, ¶ 53, 373
P.3d 189 (quotation simplified). The promise “must be
reasonably certain and definite, and a claimant’s subjective
understanding of the promisor’s statements cannot, without
more, support a promissory estoppel claim.” Id. (quotation
simplified). Here, the 2009 Budget Methodology and the
negotiations surrounding it culminated in a definite promise.
¶27 The district court determined that “the evidence shows
that Westgate promised to reduce the Association’s 2009 budget
and generate future budgets in accordance with an agreed
methodology.” The court further stated, “Westgate, via [General
Manager], expressly represented to the owners that the 2009
Budget Methodology Agreement would be used to prepare the
budgets in 2010 and thereafter.” Westgate assisted the owners in
forming the OFC so they could negotiate and reach a new
resolution regarding the budget. The owners, the Association,
and Westgate were all aware that the agreement reached was the
2009 Budget Methodology, and the district court found that
Westgate promised to adhere thereto.
¶28 This case is distinguishable from Mitchell in which this
court upheld the district court’s conclusion that promissory
estoppel cannot apply when the promise “is so indefinite that it
lacks—literally—any terms.” Mitchell, 2016 UT App 88, ¶ 54
(quotation simplified). In Mitchell, the Mitchells were told that
“once they missed two payments, they could apply for a loan
modification,” but the Mitchells interpreted this single statement
to mean “they had been assured that a loan modification would
occur.” Id. (quotation simplified). The evidence in Mitchell
20170544-CA 12 2019 UT App 36Lodge at Westgate v. Westgate Resorts
showed that “the Mitchells, at most, had a subjective
understanding that they had been assured” of a loan
modification. Id. (quotation simplified).
¶29 In this case, the owners had more than a subjective
understanding of Westgate’s promises. The 2009 Budget
Methodology was an agreement that took effect after five
months of negotiations. The resulting promise was also
sufficiently definite to enable the parties to act “in accordance
with the 2009 Budget Methodology for no less than four years.”
We affirm the district court’s determination that the 2009 Budget
Methodology represented a clear and definite promise.
B. Reasonable Reliance
¶30 The district court also determined that the owners
reasonably relied on Westgate’s promises under the 2009 Budget
Methodology by refraining from filing various lawsuits and by
paying their association dues.
¶31 The evidence shows that the “owners reasonably relied
upon the representations of Westgate by relinquishing their legal
rights to bring suits against Westgate within the statute of
limitations period.” The owners also reasonably relied on
Westgate’s representations in “paying their Association dues in
accordance with the 2009 Budget Methodology Agreement in
2009–2012.” The “[e]vidence demonstrated that numerous
owners were contemplating litigation, and after the OFC reached
an agreement with Westgate regarding the 2009 Budget
Methodology, all such threats were dropped and not a single
owner pursued litigation.” Ultimately, “[t]he 2009 Budget
Methodology Agreement brought peace to the valley, as it was
intended to do.” 7 We affirm the district court’s conclusion that
7. Westgate contends this case is similar to Johannessen v. Canyon
Road Towers Owners Association in which this court struck down a
contract between a single unit owner and the HOA where the
(continued…)
20170544-CA 13 2019 UT App 36Lodge at Westgate v. Westgate Resorts
the 2009 Budget Methodology induced reasonable reliance by
the owners. Ample evidence supports enforcing the 2009 Budget
Methodology under the theory of promissory estoppel.
III. The Cross-appeal
¶32 In its cross-appeal the Association argues the district
court made three errors. Additional factual context is necessary
to understand each of these arguments.
¶33 The Association first argues that the court made an
erroneous factual determination that the Declaration limited
“Common Areas and Facilities” to the building’s foundation. In
its complaint, the Association sought declaratory and injunctive
relief that the Association, not Westgate, controls the common
areas of the Project. The district court dismissed this cause of
action finding that the common areas are controlled by Westgate
under the Declaration.
¶34 The Association next argues the district court erred in its
finding that the “Amenities Use Fee” of the 2009 Budget
Methodology is not subject to a future increases clause. As part
of the sales launch for the Project, potential purchasers were
(…continued)
HOA agreed to assess the unit owner at a lower monthly rate.
2002 UT App 332, ¶ 5, 57 P.3d 1119. This contract was
unenforceable as contrary to the governing statute as well as the
condominium declaration. Id. ¶ 28. And this court held that the
owner could not “rely upon promissory estoppel . . . because it
was unreasonable for [him] to rely upon the . . . promise.” Id.
This case is distinguishable because Westgate had the authority
to amend the Declaration in the manner that it did. Further, the
November 6, 2009 letter sent to the owners explicitly notified
them the 2009 Budget Methodology “take[s] precedent over
those associated budget items” in the Declaration and Shared
Use Agreement.
20170544-CA 14 2019 UT App 36Lodge at Westgate v. Westgate Resorts
informed they would be able to use amenities from existing
projects for a fee instead of having to build new amenities. The
2007 budget provided to the potential purchasers included an
Amenities Use Fee. The proposed 2009 budget kept the
Amenities Use Fee the same as the 2007 budget but the owners’
use of amenities and the fees they would pay were further
negotiated as part of the 2009 Budget Methodology. During
negotiations the Association wanted to keep the Amenities Use
Fee the same for 2010 to 2011 and afterwards have the fee subject
to a future increases clause. But the future increases clause did
not appear on the finalized 2009 Budget Methodology. The
Association argued the reason the agreement regarding the
future increases clause did not appear on the finalized 2009
Budget Methodology is that the Amenities Use Fee agreement
was provided as a pdf file and the OFC did not know how to
merge the future increases clause language into the final
document because it was a pdf. The district court rejected this
argument and ruled that because the future increases clause was
omitted from the final 2009 Budget Methodology the parties did
not intend to limit the amenities fees and therefore the
Association could not claim the right to a refund of those higher
payments in its damages claim.
¶35 Finally, the Association argues the district court erred in
declining to adopt the Association’s proposed final judgment
and order for failing to comply with rule 58A of the Utah Rules
of Civil Procedure. At the conclusion of trial the court invited
each side to submit post-trial briefs. After the briefs were
submitted the court issued its findings of fact and conclusions of
law, which were subsequently amended at the request of both
sides. In the amended findings the court asked the Association to
submit a proposed form of judgment. After the Association
submitted the proposed form, the court determined that its form
was improper and declined to sign it. The Association argues
this decision was in error and asks us to remand with
instructions for the court to amend its judgment accordingly.
20170544-CA 15 2019 UT App 36Lodge at Westgate v. Westgate Resorts
A. Common Areas and Facilities
¶36 The Association contends the district court erred by
interpreting the Declaration to limit the Project’s “Common
Areas and Facilities” to the building’s foundation.
¶37 “We interpret the provisions of the Declaration as we
would a contract. If the Declaration is not ambiguous, we
interpret it according to its plain language.” View Condo. Owners
Ass’n v. MSICO, LLC., 2005 UT 91, ¶ 21, 127 P.3d 697 (quotation
simplified). “If the [district] court determines the contract is
ambiguous,” “[w]e review the trial court’s construction based on
extrinsic evidence under the more deferential clearly-erroneous
standard.” West Valley City v. Majestic Inv. Co., 818 P.2d 1311,
1313 (Utah Ct. App 1991). 8
¶38 After reviewing the Declaration’s plain language and
considering it as a whole, the district court found that “an
ambiguity exists regarding the meaning and use of the term
Common Areas and Facilities.” Article V of the Declaration
refers to “Common Areas and Facilities” as consisting “of the
foundation of the building containing the Units underneath the
8. At the outset, the Association argues the district court’s
interpretation of the Declaration conflicts with the Utah
Condominium Ownership Act. The Association contends the
Act’s definition of “Common Areas and Facilities” “explicitly
includes ‘the foundations, columns, girders, supports, main
walls, roofs, halls, corridors’ and ‘all other parts of the property
necessary or convenient to its existence, maintenance, and safety,
or normally in common use.’” (Citing Utah Code Ann. § 57-8-
3(4)(b) (LexisNexis 2010).) The Act does not require Common
Areas and Facilities of condominium projects to include any of
these. Instead, by stating “unless otherwise provided in the
declaration,” the Act defers to the governing documents for a
definition of Common Areas and Facilities. Utah Code Ann.
§ 57-8-3(4) (LexisNexis 2010).
20170544-CA 16 2019 UT App 36Lodge at Westgate v. Westgate Resorts
surface of the earth as more particularly described in the Plat.”
But the Association pointed out several other provisions of the
Declaration that conflicted with the interpretation that
“Common Areas and Facilities” is limited to the foundation.
Some of those provisions referenced “pipes, shafts, wires” and
other utilities, which the court agreed created an ambiguity over
the meaning of “Common Areas and Facilities.” We agree with
the court that the Declaration is ambiguous.
¶39 The district court then considered extrinsic evidence to
resolve the ambiguity. It looked to the Plat, Amended Plat, and
the Declaration and determined that the parties intended to limit
the “Common Areas and Facilities” to the foundation. The
original Plat recorded in 2007 included a note that stated that
“Common Areas and Facilities consist of the foundation of the
building.” An Amended Plat was recorded in 2009 and
contained the same note as the 2007 Plat but also contained a
separate sheet that depicted the foundation as the “Common
Areas and Facilities” of the Project. Based on this evidence the
court made a factual finding that “Common Areas and
Facilities” is limited to the building’s foundation.
¶40 “A party challenging the court’s interpretation of
ambiguous terms of a contract faces a substantial appellate
burden.” Majestic, 818 P.2d at 1313. We will “affirm the [district]
court’s findings if they are based on sufficient evidence, viewing
the evidence in the light most favorable to the [district] court’s
construction.” Id. Here, the Association has not adequately
challenged the district court’s factual finding that the “Common
Areas and Facilities” is limited to the building’s foundation and
it has not demonstrated that this finding was clearly erroneous.
See Allstate Enters., Inc. v. Heriford, 772 P.2d 466, 468 (Utah Ct.
App. 1989). Based on the evidence presented, we conclude the
court did not clearly err in determining that “Common Areas
and Facilities” under the Declaration is limited to the
foundation.
20170544-CA 17 2019 UT App 36Lodge at Westgate v. Westgate Resorts
B. Amenity Use Fee
¶41 The Association also argues the “trial court erred by
ignoring evidence that the parties to the 2009 Budget
Methodology Agreement intended all budget categories,
including the Amenity Use Fee, to be subject to a Future Increase
Clause.” As a result the Association contends the district court
erred in refusing to grant the Association damages for
overpaying the Amenity Use Fee from 2013 to 2016.
¶42 First, the Association argues the district court’s finding of
fact regarding the Amenity Use Fee was clearly erroneous. “A
[district] court’s factual findings are clearly erroneous only if
they are in conflict with the clear weight of the evidence, or if
this court has a definite and firm conviction that a mistake has
been made.” Bonnie & Hyde, Inc. v. Lynch, 2013 UT App 153, ¶ 17,
305 P.3d 196 (quotation simplified). “Consequently, as an
appellate court, we give great deference to the [district] court
and do not lightly disturb its factual findings.” Id. (quotation
simplified).
¶43 The district court found that the 2009 Budget
Methodology “ratified by Westgate and applied by the
Association to the 2014–16 budgets” was “not subject to a Future
Increase Clause.” And the Association concedes the 2009 Budget
Methodology does not contain any language that would apply a
future increase clause to the Amenity Use Fee.
¶44 But the Association argues this finding was clearly
erroneous because “[t]he evidence showed that the only reason a
future increases clause does not appear on the face of [the 2009
Budget Methodology] is that [General Manager] provided that
page in PDF, rather than as an amendable Word document, and
the OFC was not technically savvy enough to augment the
document with the language of the future increase clause.” The
Association also argues that General Manager agreed to a future
increases clause to the Amenities Use Fee in an email. The
district court did not find this argument persuasive because the
20170544-CA 18 2019 UT App 36Lodge at Westgate v. Westgate Resorts
email exchange was “in the midst of the parties’ negotiations
and discussions regarding the budget and was not the final
agreement ratified by Westgate.” The final agreement ratified
by Westgate does not have the future increases clause so “it
is the content of [the final agreement] that controls, not a
statement made by [General Manager] in the midst of
negotiations.”
¶45 Our review of the record demonstrates that the district
court’s finding regarding the future increase clause is not against
the clear weight of the evidence and therefore is not clearly
erroneous. See Bonnie & Hyde, 2013 UT App 153, ¶ 17.
¶46 Next, the Association argues that because the factual
finding was clearly erroneous, the district court also erred in
failing to award the Association damages for overpaying the
Amenity Use Fee. But because we conclude the court did not err
in its factual finding, we also conclude the court did not err in
refusing to grant the Association damages. The court found “the
budgets during 2014–16 were voted on and approved by the
Association after Westgate no longer controlled the
[Association’s] Board.” And contrary to the Association’s
argument, the court’s preliminary injunction did not require the
Association to include the higher figures from 2013 in future
budgets during the pendency of this litigation.” The court’s
preliminary injunction required the parties to establish budgets
in compliance with the 2009 Budget Methodology. If the
budgets did not comply but were nevertheless agreed to, it
was “not because of a breach of fiduciary duty by Westgate,
but an error by the Association no longer controlled by
Westgate.”
¶47 Because the “Amenities Use Fee” is not subject to a future
increases clause, we affirm the district court’s refusal to grant the
Association damages for any overpayment of the “Amenity Use
Fee.”
20170544-CA 19 2019 UT App 36Lodge at Westgate v. Westgate Resorts
C. The Judgment
¶48 Finally, the Association contends the district court erred
“by rejecting certain features of the [Association’s] Proposed
Final Judgment and Order.” The court rejected the Association’s
proposed final judgment and order because it did not comply
with rule 58A of the Utah Rules of Civil Procedure. This rule
requires that “[e]very judgment and amended judgement must
be set out in a separate document.” Utah R. Civ. P. 58A(a). 9
¶49 The district court found that the Association’s “proposed
Final Judgment and Order does not comply with Rule 58A,
[f]ederal case law interpreting the counterpart found in the
federal rules, or the Advisory Committee’s directives.” Instead,
the court ruled that the Association’s proposed order “recites
facts and procedural history and contains rulings not made by
this Court in its Amended, Corrected, and Clarified Findings of
Fact and Conclusions of Law, or in its separate Ruling and
9. We base our decision solely upon the plain language of rule
58A. Nevertheless, we also observe that the Utah Supreme
Court’s Advisory Committee on the Rules of Civil Procedure’s
explanation of what constitutes a “separate document” supports
our conclusion. The Advisory Committee Notes to rule 58A
suggest following federal precedent on the issue and using three
criteria to determine whether a proposed judgment submitted is
a “separate document.” Utah R. Civ. P. 58A advisory committee
note to 2015 amendments. First, the document must be
“independent of the court’s opinion or decision.” In re Cendant
Corp., 454 F.3d 235, 242 (3d Cir. 2006). Second, it “must note the
relief granted.” Id. Third, the proposed judgment “must omit (or
at least substantially omit) the District Court’s reasons for
disposing of the parties’ claims.” Id. While some “trivial
departures must be tolerated in the name of common sense,”
they must be “very sparse.” Kidd v. District of Columbia, 206 F.3d
35, 39 (D.C. Cir. 2000).
20170544-CA 20 2019 UT App 36Lodge at Westgate v. Westgate Resorts
Order.” Based on these deficiencies, the court refused to sign the
Association’s proposed judgment.
¶50 We agree with the district court that the Association’s
proposed judgment does not comply with rule 58A because it
was not set out in a separate document.
CONCLUSION
¶51 The Association had standing to bring its claims against
Westgate seeking enforcement of the 2009 Budget Methodology.
The district court did not err in enforcing the 2009 Budget
Methodology under the doctrine of promissory estoppel.
Likewise, the court did not err in interpreting the Declaration to
limit the “Common Areas and Facilities” to the building’s
foundation nor did it err in determining the Amenities Use Fee is
not subject to a future increases clause. Finally, the court did not
err when it refused to adopt the Association’s proposed
judgment. We affirm.
20170544-CA 21 2019 UT App 36