For curiosity I asked Co-Pilot about it and got this response:The language in your CC&Rs stating that “no business or bed and breakfast is allowed” can indeed impact the interpretation of short-term rentals, but it may not be as straightforward as it seems.Definition of Business: Courts have often ruled that short-term rentals (like those listed on platforms such as Airbnb) do not necessarily qualify as a “business” in the traditional sense.

So he may consider this most of the basic functions of PM without actually being a PM (and thus not subject to regulation). 

The best thing you can do without going to court and in this case 50/50 chance of losing, negotiation them down on their price.

This is gonna be a learning experience due to dealing with environmental court.

I would get an attorney or agent involved and in reality you should only be dealing with him as he owns the home unless there is a court order elsewhere that gives her some rights tothe propertyI think it's possible the final decree of divorce or the property settlement agreement required her to give him a deed in return for him paying her equity. 

The process required coordination with local authorities and additional time and expense, but resolving it added long-term value and functionality to the property.

Without a written record of this arrangement, is there a way to claim any compensation for those renovation costs, or would that be difficult to prove in court?

Exterior structural, structural, functional, cosmetic. ( some variations, but generally true)

Since the lease was with both then you need to make the check out to both, to do otherwise would be making a legal determination which is what the domestic court is for, and where they can take their issue to resolve. 

Will court still proceed and grant eviction case in my favor?