Opinion
NOT TO BE PUBLISHED
Superior Court County of Ventura No. CIV 246173, Ken W. Riley, Judge.
Adams Kessler PLC, Mark A. O'Brien for Defendant and Appellant.
Klass, Helman & Ross, Robert M. Ross, Jackie Rose Kruger for Plaintiff and Respondent.
PERREN, J.
Malibu Bay Owners Association (Association) appeals from orders denying its special motion to strike the complaint of Dr. Renee Lim (Lim) as a SLAPP suit (strategic lawsuit against public participation) and awarding attorney fees to Lim under Code of Civil Procedure section 425.16. The Association contends that Lim's lawsuit arose from protected activity, that Lim did not establish a probability of prevailing, and that the court's award of attorney fees to Lim was unauthorized. We affirm. The Association did not meet its burden of showing that Lim's lawsuit arose from protected activity and the fee award was authorized.
All statutory references are to the Code of Civil Procedure.
FACTUAL AND PROCEDURAL HISTORY
Lim filed a complaint against the Association for breach of fiduciary duty, seeking an accounting and declaratory relief. The complaint alleges that the Association breached its fiduciary duty to its members by failing to maintain its books and records in accordance with generally accepted accounting principles, by failing to exercise oversight over the property and property management company it hired, by failing to exercise due and proper care for the funds paid by the owners and the physical condition of the property, and by mismanaging its financial affairs.
The complaint also alleges that the Association, through acts of economic intimidation, has attempted to chill Lim's protests against its conduct and activities. According to the complaint, Lim has been threatened with economic penalties for exercise of her First Amendment rights by contacting the Association's board members and the current management company to address grievances relating to landscaping, the condition of the premises, failure to accurately account for payment of her dues and other issues. The Association has threatened to assess a financial penalty on her under the bylaws for creating a nuisance.
Three letters are attached to the complaint. The first is a letter from the Association's attorney to Lim threatening her with "fines, suspension of privileges, and court-imposed restraining orders if she did not cease and desist from rude, abusive, threatening, and harassing behavior toward Malibu's staff and directors." The second letter is from the Association's attorney to Lim's attorney, giving Lim notice of a hearing on her behavior toward staff and directors, under the Association's CC&R's and rules. The third letter also is from the Association's attorney to Lim's attorney, discussing the scheduled hearing and enclosing three e-mails from Lim to the Association's counsel and board.
In response to Lim's complaint, the Association filed a motion to strike under section 425.16, asserting Lim's suit was aimed at depriving the Association of its right to free speech. The trial court denied the motion on the ground that Lim's lawsuit did not involve protected activity. The court also awarded attorney fees to Lim in the amount of $2,000.
DISCUSSION
The Trial Court Did Not Err in Denying the SLAPP Motion
A. General principles
The anti-SLAPP statute provides: "A cause of action against a person arising from any act of that person in furtherance of the person's right of petition or free speech under the United States or California Constitution in connection with a public issue shall be subject to a special motion to strike, unless the court determines that the plaintiff has established that there is a probability that the plaintiff will prevail on the claim." (§ 425.16, subd. (b)(1).)
The statute was enacted to prevent and deter lawsuits that chill the valid exercise of the constitutional rights of freedom of speech and petition for the redress of grievances and provides "an efficient procedural mechanism to obtain an early and inexpensive dismissal of nonmeritorious claims" arising from the exercise of those constitutional rights. (Martinez v. Metabolife Internat., Inc. (2003) 113 Cal.App.4th 181, 186.)
Section 425.16, subdivision (e) defines acts in furtherance of free speech or petition rights in connection with a public issue by setting forth four categories of conduct to which the statute applies: "As used in this section, 'act in furtherance of a person's right of petition or free speech under the United States or California Constitution in connection with a public issue' includes: (1) any written or oral statement or writing made before a leglislative, executive, or judicial proceeding, or any other official proceeding authorized by law; (2) any written or oral statement or writing made in connection with an issue under consideration or review by a legislative, executive or judicial body, or any other official proceeding authorized by law; (3) any written or oral statement or writing made in a place open to the public or a public forum in connection with an issue of public interest; [or] (4) . . . any other conduct in furtherance of the exercise of the constitutional right of petition or the constitutional right of free speech in connection with a public issue or an issue of public interest."
An anti-SLAPP motion requires the trial court to engage in a two-step process. First, the court decides whether the defendant has made a threshold showing that the challenged cause of action is one arising from protected activity. (Equilon Enterprises v. Consumer Cause, Inc. (2002) 29 Cal.4th 53, 67.) Second, "[i]f the court finds such a showing has been made, it then determines whether the plaintiff has demonstrated a probability of prevailing on the claim." (Ibid.) "The trial court's determination of each step [of the process] is subject to de novo review on appeal." (Martinez v. Metabolife Internat., Inc., supra, 113 Cal.App.4th 181, 186.)
B. The challenged cause of action must "arise from" protected activity
Protected speech or petitioning activity must be the activity that "gives rise to [defendant's] asserted liability." (Navellier v. Sletten (2002) 29 Cal.4th 82, 92.) "[T]he statutory phrase 'cause of action . . . arising from' means that the defendant's act underlying the plaintiff's cause of action must itself have been an act in furtherance of the right of petition or free speech." (City of Cotati v. Cashman (2002) 29 Cal.4th 69, 78.) "The anti-SLAPP statute's definitional focus is not the form of the plaintiff's cause of action but, rather, the defendant's activity that gives rise to his or her asserted liability-and whether that activity constitutes protected speech or petitioning." (Navellier, at p. 92.)
C. The causes of action here do not arise from protected activity
The Association's sole contention is that the letters attached to Lim's complaint are protected speech under section 425.16, subdivision (e)(3) and (4). As set forth above, each of the three letters was written by the Association's counsel regarding Lim's conduct in contacting board members about various issues involving the operation and management of the Association. The Association characterizes the letters as an attempt "to enforce its CC&R's and rules" and that the letters are "protected speech and petition activity by the Association and its Board and counsel, in a public forum, and involving matters of public interest." Undoubtedly, these letters constitute speech; but not all speech is protected by the SLAPP statutes. A specific public interest showing is required for speech claimed to fall under section 425.16, subdivision (e)(3) and (4). (Briggs v. Eden Council for Hope & Opportunity (1999) 19 Cal.4th 1106, 1111-1123.) "The 'public interest' component of section 425.16, subdivision (e)(3) and (4) is met when 'the statement or activity precipitating the claim involved a topic of widespread interest,' and 'the statement . . . in some manner itself contribute[s] to the public debate.'" (Huntingdon Life Sciences, Inc. v. Stop Huntingdon Animal Cruelty USA, Inc. (2005) 129 Cal.App.4th 1228, 1246.)
In arguing the letters meet the criteria of being "in connection with a public issue or issue of public interest," the Association misplaces its reliance upon cases involving the fundamental governance of homeowners associations. In Damon v. Ocean Hills Journalism Club (2000) 85 Cal.App.4th 468, 479, statements made at a homeowners association board meeting and in the association newsletter involved "issues of public interest" because "they concerned the very manner in which this group of more than 3,000 individuals would be governed--an inherently political question of vital importance to each individual and to the community as a whole." In Ruiz v. Harbor View Community Assn. (2005) 134 Cal.App.4th 1456, 1468-1470, letters from the homeowners association's lawyer to a member involved issues of public interest because they were part of an ongoing dispute whether the homeowners association was evenhandedly enforcing its architectural guidelines.
No such fundamental governance issues are raised in Lim's complaint. While mismanagement of funds and failure to maintain common areas may be of concern to other Association members, there is no showing that the letters were published in a public forum or concerned an ongoing dispute between the Association and a large group of tenants. In fact, the Association admits in its brief that "[t]he letters were only communicated to Lim or her counsel." Merely suing to force the Association to comply with the CC&R's and properly maintain the premises and account for homeowners' dues is not properly the subject of an anti-SLAPP motion.
The Association's threats against a single homeowner for speaking out on issues involving the Association is not speech on a public issue protected by the First Amendment. The only protected speech involved here is Lim's. It would turn the anti-SLAPP statute on its head to hold that such threats constitute protected speech.
The Association has failed to demonstrate that Lim's complaint arises from protected speech or petitioning activity. In view of our conclusion that Lim's complaint does not arise from protected activity, we need not reach the anti-SLAPP statute's secondary question whether Lim established a probability of prevailing on their claims. (City of Cotati v. Cashman, supra, 29 Cal.4th 69, 80-81.)
The Trial Court Did Not Err in Awarding Attorney Fees
The anti-SLAPP statute mandates an award of attorney fees to a plaintiff when the court denies the SLAPP motion and finds that the motion was frivolous. (§ 425.16, subd. (c); Moore v. Shaw (2004) 116 Cal.App.4th 182, 199.) A determination of frivolousness requires a finding the motion is "totally and completely without merit" (§ 128.5, subd. (b)(2)), that is, "any reasonable attorney would agree such motion is totally devoid of merit." (Karwasky v. Zachay (1983) 146 Cal.App.3d 679, 681.)
We review an award of attorney fees and costs for abuse of discretion. (Visher v. City of Malibu (2005) 126 Cal.App.4th 364, 368.) "'[T]he appropriate test for abuse of discretion is whether the trial court exceeded the bounds of reason.'" (Dove Audio, Inc. v. Rosenfeld, Meyer & Susman (1996) 47 Cal.App.4th 777, 785.)
The Association contends the order awarding attorney fees should be vacated because the trial court did not set forth the justification for its finding of frivolousness. Attorney fees under section 425.16 are awarded "pursuant to Section 128.5." (§ 425.16, subd. (c).) Under section 128.5, "An order imposing expenses shall be in writing and shall recite in detail the conduct or circumstances justifying the order." (§ 128.5, subd. (c).) The conduct or circumstances justifying the imposition of sanctions may be satisfied by incorporating by reference "papers setting forth the conduct, circumstances, and legal arguments underlying the court's conclusions." (Childs v. PaineWebber Incorporated (1994) 29 Cal.App.4th 982, 996.)
In this case, the trial court's order complies with the statutes. It states: "The Court will grant sanctions payable by Malibu Bay Association to Counsel for Dr. Lim in the amount of [$]2,000.00 by June 1, 2007. [¶] The court agrees with plaintiff that there is not protected speech." In this short statement, the court gave its reason for finding the action frivolous and impliedly incorporated by reference Lim's briefs and arguments. No more is required. (See California Back Specialists Medical Group v. Rand (2008) 160 Cal.App.4th 1032, 1038.)
The orders of the trial court are affirmed. Respondent shall recover costs.
We concur: YEGAN, Acting P.J., COFFEE, J.