The Lodge at Westgate Park City Resort and Spa Condominium Association Inc., Appellee and Cross-appellant,
Westgate Resorts Ltd. and CFI Resorts Management Inc., Appellants and Cross-appellees.
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
G. Russell, Matthew J. Ball, Phillip S. Ferguson, Rebecca L.
Hill, and Stephen D. Kelson, Attorneys for Appellee and
Kate Appleby authored this Opinion, in which Judges Gregory
K. Orme and Diana Hagen concurred.
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 that the term "Common
Areas and Facilities" under the Declaration is limited
to the building's foundation. We affirm.
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).
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
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
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. By this time,
condominium sales had mostly come to a stop due to the
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.
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.
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
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
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."
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."
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
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.
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. 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.
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. 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.
AND STANDARDS OF REVIEW
We address two of the issues Westgate raises on
appeal.First, Westgate argues the Association does
not have standing to 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.
Second, it contends the facts of the case preclude the
district court from enforcing the 2009 Budget Methodology
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.
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."
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.
Finally, the Association argues the district court
"erred by declining to adopt certain features of the
Association's proposed 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 ...