Crestmar Owners Assn. v. Stapakis

In Crestmar Owners Assn. v. Stapakis (2007) 157 Cal.App.4th 1223, a developer failed to deed real property to an owners' association as required under the governing Covenants and Restrictions Establishing Reciprocal Easements and a Plan of Ownership for Portside, San Francisco, California (CC&Rs). The developer, Hartford Equity and Management Corporation (Hartford), converted a building into condominiums in 1977. After the conversion, Crestmar Owners Association (Crestmar) assumed management of the property's common areas. Under the CC&Rs, Hartford was obligated to transfer a parking space in the building's garage to anyone who bought a condominium. The CC&Rs further provided that if any condominiums remained unsold three years after the first unit was purchased, Hartford had to convey all remaining unassigned parking spaces to Crestmar. (Crestmar, supra, 157 Cal.App.4th at p. 1225.) The first condominium unit was purchased in the late 1970s, meaning Hartford should have transferred any remaining parking spaces to Crestmar sometime in the early 1980s. In 2004, Hartford conveyed to its president, William Stapakis, two parking spaces it had not transferred to Crestmar, and Stapakis demanded from Crestmar back rent for its use of the parking spaces since the early 1980s. In response, Crestmar filed a complaint in January 2005, seeking (1) cancellation of Hartford's deeds to Stapakis, (2) enforcement of the equitable servitudes in the CC&Rs obligating Hartford to convey the parking spaces to Crestmar, and (3) quiet title to the two parking spaces in Crestmar. (Crestmar, supra, 157 Cal.App.4th at pp. 1225-1226.) Stapakis moved for summary judgment, contending Crestmar's cause of action to enforce the CC&Rs accrued in the early 1980s, when Hartford failed to convey the two parking spaces to Crestmar as required under the CC&Rs. The trial court denied summary judgment, reasoning that Crestmar's cause of action to enforce a covenant running with the land accrued when Crestmar demanded Hartford's performance with the filing of its complaint, therefore the complaint was timely. (Crestmar, supra, 157 Cal.App.4th at p. 1226.) Subsequently, the trial court conducted a bench trial and entered judgment quieting title to the two parking spaces in Crestmar. Stapakis and Hartford appealed, contending the complaint was untimely. (Id. at 1227.) The appellate court rejected the trial court's finding that Crestmar's cause of action on the CC&Rs accrued when Crestmar demanded performance. (Crestmar, supra, 157 Cal.App.4th at pp. 1227-1228.) The appellate court nevertheless concluded the complaint was timely "because the statute of limitations for an action to quiet title does not begin to run until someone presses an adverse claim against the person holding the property." (Id. at p. 1228.)