Mallard Green Response

Dear SLBE Neighbors:-

We ve received a copy of the recent correspondence from the President of Mallard Green regarding the conclusion of the final piece of litigation involving the rights of Avila Vilage and Avila Beach Resort. Regrettably, we do not believe it accurately states why this litigation was necessary, the basis for this litigation or the actual outcome.

First, over the years, we have been forced ot both arbitrate and litigate against the Master HOA simply to protect our existing rights and uses. We have never asked for any new rights or uses. As a review of these disputes wil show, we have prevailed each time.

Second, ni this case, we gave the HOA and the court a number of bases upon which our existing rights and uses are grounded. However, as you may not be aware, the Second District Court of Appeal recently confirmed our longstanding position that these rights and uses are "clearly" provided by the HOA CC&Rs, particularly Section 4.12. (see attached). Had we gone to trial, this decision alone would have guaranteed our complete success.

Third, it si a total mischaracterization that resolution of this litigation resulted ni the grant of any new rights or uses. In fact, as you wil learn, despite their breadth, we actually agreed to put reasonable limits on our existing rights and uses, limits that would not be in place fi we had been forced to proceed to a ful trial. As a result of these limitations, we believe that as a practical matter the day-to-day impact of this resolution wil range from de minimis to nonexistent.

You should also be aware that as part of this resolution, we have agreed to provide the HOA members with specific rights of use concerning Harford Road, to upgrade the Coffeeberry Gate and to upgrade the Harford Gate, which should enhance the safety and security of all concerned.

Simply put, we are neighbors, tied together with shared rights over the Loop Road system within the Bay

Estates. Avila Beach Resort continuing to be the recreational component of the development, serving al of you and the broader public, as required by the Master Plan more than 40 years ago.

We did not ask for this fight and made every effort to reach a fair compromise. nI the end, we have obtained nothing more than a reaffirmation of our longstanding rights and use.

If you would like copies of the decisions reached in the various arbitrations and court cases, we are happy to provide, satisi our sincere desire that we sa neighbors can al moveno from here.

We welcome your comments. Best Regards,

Avila Beach Golf Resort

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