Anti-SLAPP and HOA Disputes

Colyear v. Rolling Hills Community Association of Rancho Palos Verdes (2017) 9 Cal.App.5th 119 is a recent example of an anti-SLAPP motion being a very powerful defense weapon in HOA litigation.

The term “SLAPP” means “Strategic Lawsuits Against Public Participation,” which includes a lawsuit based on conduct in furtherance of the exercise of free speech regarding an issue of “public interest.”  (Code of Civil Procedure §425.16.)   California law provides that a defendant can seek to immediately strike such a lawsuit and if the defendant’s anti-SLAPP motion is granted, the statute provides that the prevailing defendants is entitled to its attorney’s fees and costs incurred in bringing the motion.  A SLAPP lawsuits are considered to be “generally meritless suits brought primarily to chill the exercise of free speech or petition rights by the threat of severe economic sanctions against the defendant, and not to vindicate a legally cognizable right.”

Colyear and other cases provide chilling examples of how the anti-SLAPP motion procedure has been used to squash homeowners seeking judicial relief from allegedly out of control HOA boards of directors or disputes with other homeowners (members).

Facts

Colyear arises from homeowner defendant Yu Ping Liu’s “Application for Assistance to Restore View” that he with the HOA, because the view from his residence was obstructed by several trees and hedges.   The CC&Rs provided that the HOA had “the right at any time to enter on or upon any part” of a property subject to that declaration “for the purpose of cutting back trees or other plantings which, in the opinion of the [HOA], is warranted to maintain and improve the view of, and protect, adjoining property.”  Liu believed that the trees in question  were on the property immediately north of Liu’s property, which was owned by Richard and Kathleen Krauthamer.  However, plaintiff Richard Colyear alleged that the trees were in fact on his property, which was directly east of the Krauthamer’s property, and kitty-corner to Liu’s property.  Liu, Colyear, and the Krauthamers are all members of the HOA.

Two months after the Application was filed, Colyear filed a lawsuit against Liu and the HOA Board.  Colyear alleged that two of the offending trees were actually on his property, that the relevant tree-trimming CC&R provision covenant did not encumber his property, and therefore that Liu and the HOA were wrongfully clouding his title.

One month after being sued, Liu withdrew his Application.  As a result, the HOA never issued any decision on the Application. Following the withdrawal, the HOA had no pending applications involving either Liu or Colyear’s property.

Colyear’s operative verified complaint “for Declaratory Relief, Injunctive Relief, To Quiet Title, and for Damages” sought a declaration, among other things, that Colyear’s lot was not subject to the tree-trimming CC&R provision; and that a specific HOA Board’s Resolution was void to the extent it purported to enforce such tree-trimming covenant.   The complaint sought to quiet title to Colyear’s lot that it was not covered by the trees tree-trimming CC&R provision.  Finally, the complaint sought injunctive relief barring defendants from seeking to enforce the relevant covenant against Colyear’s lot.  The plaintiff also claimed compensatory and punitive damages from the HOA and the board for alleged fraud and breaches of fiduciary duties.

Liu filed an anti-SLAPP motion to strike Colyear’s complaint, which the trial court granted and court of appeal affirmed.

Decision

The main issue in the report court of appeal decision was whether Colyear’s claim arose from “protected activity.”  The anti-SLAPP motion procedure applies to a lawsuit based on a statement made in connection with “an issue of public interest.”  (Code of Civil Procedure §425.16(e)(4).)

California caselaw holds that “‘public interest’ within the meaning of the anti-SLAPP statute has been broadly defined to include, in addition to government matters,  ‘“private conduct that impacts a broad segment of society and/or that affects a community in a manner similar to that of a governmental entity.” ’ Thus, “several courts have found protected conduct in the context of disputes within a homeowners association.”  Colyear, suppra, at 131; see e.g., Ruiz v. Harbor View Community Assn. (2005) 134 Cal.App.4th 1456, 1468, Country Side Villas Homeowners Assn. v. Ivie (2011) 193 Cal.App.4th 1110, 1113; Damon v. Ocean Hills Journalism Club (2000) 85 Cal.App.4th 468, 479; Lee v. Silveira (2016) 6 Cal.App.5th 527, 540; Talega Maintenance Corporation v. Standard Pacific Corporation (2014) 225 Cal.App.4th 722, 729.

The court rejected Colyear argument that Liu’s application was just a private tree-trimming dispute between two neighbors and therefore does not qualify as a matter of “public interest.”  The court rejected that the argument because Liu’ application evidenced that there was an ongoing controversy, dispute, or discussion regarding the applicability of tree-trimming C&R provision and the HOA’s authority to enforce it.  Furthermore, the issue was an ongoing topic of debate between the board and homeowners, resulting in multiple hearings, letters, and several changes to the board’s policy on the matter starting as early as 2002 and continuing up to the current dispute. In this context, Liu’s application sought to invoke the HOA process at the center of that dispute.

(The reported decision further discussed: Claim Arises From Protected Activity; and Colyear Cannot Demonstrate a Probability of Prevailing Against Liu.)

 

On the one hand, the case seems to be chilling use of the anti-SLAPP procedure to preclude the right to resolve a CC&R/HOA related disputed by litigation.   We can appreciate plaintiff Colyear’s desire to obtain judicial relief for the ongoing dispute regarding the CC&R’s tree trimming provision and the HOA’s right or power to enforce it.    But obviously the case would have had a different outcome if Colyear would have pursued the HOA’s “dispute resolution process.”   California’s HOA laws (the Davis-Stirling Act) contain several sections that sometimes require the use of the dispute resolution process before litigation can be filed.  Civil Code section 5905 requires that associations provide a “fair, reasonable, and expeditious procedure for resolving a dispute” with members.

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