The Lead Case
114 Cal.App.5th 788 — The case that rewrote HOA liability in California.
Water intrusion from a common area roof defect infiltrated the plaintiff's unit. The HOA was notified and did nothing meaningful for 19+ months despite repeated expert warnings that mold was growing. The unit became uninhabitable. The board president made false statements minimizing the problem. The homeowner was forced to vacate while continuing to pay their mortgage.
Against the HOA corporate entity for conscious disregard of known hazard
Against the board president personally for false statements and obstruction
Compensatory + punitive + injunctive relief combined
The appellate court held that the business judgment rule — normally a shield for HOA board decisions — does not protect decisions made in bad faith. When a board knows about a health hazard, receives expert warnings, and consciously chooses inaction, that constitutes bad faith. The board loses its protection and becomes personally liable for the consequences.
Supporting Authority
Six additional cases that reinforce the legal framework and damages potential.
| Case | Year | Court | Key Holding | Relevance |
|---|---|---|---|---|
| Frances T. v. Village Green | 1986 | CA Supreme Court | HOAs owe a landlord-like duty of care to unit owners. Board members face personal liability for breaches. | Core |
| Sands v. Walnut Gardens | 2019 | CA Court of Appeal | HOA held liable for failure to repair roof and pipe defects causing water intrusion and property damage to units. | Direct |
| Affan v. Portofino Cove | 2010 | CA Court of Appeal | Business judgment rule does not protect inaction. A board that fails to act on known maintenance obligations cannot claim discretion. | Key |
| Posey v. Leavitt | 1991 | CA Court of Appeal | An individual owner has standing to sue the HOA to compel enforcement of CC&R maintenance provisions. | Standing |
| Hohne Family (Los Angeles) | 2025 | Jury Verdict | Family awarded $10.1 million for mold, lead, and mycotoxin exposure in a residential property. | Damages |
| Ghafouri v. Daftary | 2023 | Jury Verdict | Jury awarded $2.04 million for mold exposure and related health injuries in residential context. | Damages |
Comparative Advantage
Three structural advantages that did not exist in the Ridley case.
SB 900 became effective January 1, 2025 — after the Ridley events occurred. The Ridley HOA could at least argue it had no statutory mechanism to bypass the member vote. Uniappartment HOA has no such excuse. The emergency assessment tool exists and they refuse to use it.
Ridley involved a single plaintiff unit. Jose's building has 9 affected units from the same roof failure. This transforms the case from an individual dispute into a systemic failure — dramatically increasing both the damages exposure and settlement pressure on the HOA.
Jose has already obtained professional mold testing confirming 790 spores/m³ — 3.04× the outdoor baseline. This is documented, laboratory-verified evidence of a health hazard. In Ridley, mold evidence was developed during litigation. Jose starts ahead.
Every element that produced the $1.8M judgment in Ridley is present here — and Jose has three additional advantages the Ridley plaintiff did not. If anything, the case for liability and punitive damages is stronger, not weaker, than the precedent.