9 Cal.App.5th 119 (2017)
[Dispute Resolution; Anti-SLAPP] An action by a HOA member to invoke a HOA’s dispute resolution process over a tree-trimming covenant was a matter of public interest and thus constitutionally protected activity.
Law Offices of Michael D. Berk, Michael D. Berk; Greines, Martin, Stein & Richland, Kent Richland and Jonathan H. Eisenman for Petitioner and Appellant.
Hanson Bridgett, Christopher David Jensen; and Alice Liu Jensen for Defendant and Respondent Yu Ping Liu.
OPINION
COLLINS, J. —
INTRODUCTION
Defendant homeowner Yu Ping Liu submitted an application to his homeowners association, defendant Rolling Hills Community Association of Rancho Palos Verdes (HOA), seeking to invoke the HOA’s dispute resolution process against a neighbor who refused to trim trees blocking Liu’s view. Plaintiff Richard C. Colyear, another neighbor and HOA member, sued Liu and the HOA, alleging that two of the offending trees were actually on his property, that the relevant tree-trimming covenant did not encumber his property, and therefore that Liu and the HOA were wrongfully clouding his [124] title by seeking to apply such an encumbrance. Liu filed a special motion to strike the claims alleged against him under Code of Civil Procedure section 425.16, the anti-SLAPP statute.[1] The trial court granted the motion and Colyear now appeals.
We conclude Liu has made a prima facie showing that Colyear’s complaint arises from Liu’s statements made in connection with an issue of public interest, and therefore Liu’s statements are protected under section 425.16, subdivision (e)(4) (section 425.16(e)(4)). In addition, Colyear cannot show a probability of success on the merits of his claims against Liu, particularly because Liu dismissed his application shortly after the lawsuit was filed and has never sought to invoke the HOA’s tree-trimming process against Colyear. We therefore affirm.
FACTUAL AND PROCEDURAL HISTORY
A. Background
Liu and Colyear are both homeowners in Rancho Palos Verdes, a planned residential community in the city of Rolling Hills. The property immediately north of Liu’s property is owned by Richard and Kathleen Krauthamer. Colyear’s property is 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.
Each home within the community is subject to a declaration of covenants, conditions, and restrictions (CC&Rs). The original declaration recorded in 1936, declaration 150 (Declaration 150), set forth the specific property to be included in the community, conferred authority on the HOA to (among other things) “interpret and enforce” the CC&Rs, and detailed a number of CC&Rs applicable to the specified lots. As relevant here, in article I, section 11, Declaration 150 conferred upon the HOA “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.”
As the community expanded, the HOA entered into new declarations covering the additional properties; those declarations contained provisions that were similar, but not identical, to Declaration 150. Declaration 150-M, recorded in 1944, added the property including the lots now owned by Liu, [125]
Colyear, and the Krauthamers. Liu does not dispute that these three lots are burdened by declaration 150-M (Declaration 150-M), rather than by Declaration 150, and that 150-M does not contain a provision similar to that in Declaration 150 regarding tree trimming.[2] According to Colyear, Declaration 150 applies to approximately 84 lots, Declaration 150-M applies to approximately 14 lots, and other declarations cover an additional 657 lots. Ultimately, the community subject to HOA jurisdiction grew to encompass the same boundaries as the city of Rolling Hills. (See Russell v. Palos Verdes Properties (1963) 218 Cal.App.2d 754, 758 [32 Cal.Rptr. 488], disapproved of on another ground by Citizens for Covenant Compliance v. Anderson (1995) 12 Cal.4th 345 [47 Cal.Rptr.2d 898, 906 P.2d 1314].)
The HOA is governed by a board of directors. Starting in 1997, the board adopted resolutions to “establish procedures for its members to utilize the authority of the [HOA] to correct view impairments created by trees or other plantings.” The board adopted the most recent version, resolution 220 (Resolution 220), in 2012. Resolution 220 quoted the tree-trimming provision in article I, section 11 of Declaration 150 and stated that it “applies to some, if not all, properties in the City of Rolling Hills.” Resolution 220 further made the following findings: “WHEREAS, the [HOA] has held public meetings, circulated drafts of policy alternatives, and received numerous written and oral communications from its members; [¶] WHEREAS, Rolling Hills enjoys both beautiful views and an abundance of mature trees, and values both …; [¶] WHEREAS, the [HOA] wishes to adopt both guidelines and establish procedures for its members to utilize the authority of the [HOA] to correct view impairments, which cannot be resolved between the parties; [¶] WHEREAS, the Deed Restrictions give the [HOA] `… the authority to exercise such powers of control, interpretation, construction, consent, decision, determination … and/or enforcement of covenants … as far as may legally be done.'” Based on these and other findings, Resolution 220 established guidelines for processing “all view impairment applications” submitted to the HOA, including submission of an application by the homeowner requesting tree removal, payment by the applicant of an administrative fee and agreement to pay the entire cost of tree trimming or removal, notice sent by the HOA to the affected owner and contiguous property owners, a decision and report by a View Committee, and a process by which to appeal that decision to the board. Resolution 220 also noted that the “City of Rolling Hills Ordinance Chapter 17.26 provides a procedure for abatement of view impairment; so [HOA] members have another alternative for view restoration.”
[126] As early as 2002, Colyear began to inquire of the board (based on the predecessor to Resolution 220) whether it was the HOA’s position that the tree-trimming provision was enforceable against his lot. At the time, he was told it was not, and he would “have to use the City’s Ordinance” to settle any view disputes.
B. Liu’s Application and Colyear’s Complaint
In January 2015, in accordance with the process outlined in Resolution 220, Liu filed an “Application for Assistance to Restore View” with the HOA, identifying the Krauthamer property as the location of the obstructing trees or shrubs. In a statement attached to the application, Liu explained that the view from his residence was obstructed by several trees and hedges on the south side of the Krauthamers’ property. He said he had attempted to resolve the issue by speaking to Richard Krauthamer starting in late 2012, and by contacting the HOA’s city manager in June 2013 and requesting that she informally mediate the dispute. As a result, according to Liu, Krauthamer agreed to trim his trees but never did so. Liu also attached to his application several photographs of the offending trees and hedges. The application does not reference Colyear or Colyear’s property.
As an adjoining property owner, Colyear received notice of Liu’s application shortly after it was submitted. Colyear then filed the instant action on March 4, 2015, seeking writ relief and naming Liu, the HOA, its board, and individual board members as respondents. Colyear alleged that Liu’s application “may implicate” trees on Colyear’s property, but did not otherwise seek relief from Liu.
Liu withdrew his application to the HOA on April 14, 2015. 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.
In August 2015, the trial court sustained the demurrers filed by all defendants, and granted leave to amend. Colyear filed an amended pleading, including a petition for writ of traditional mandate and prohibition against the HOA and its board, and a verified complaint “for Declaratory Relief, Injunctive Relief, To Quiet Title, and for Damages” against all defendants (FAC). The FAC sought a declaration, among other things, that Colyear’s lot was not subject to the tree-trimming covenant in Declaration 150 and that such covenant could not be enforced against his lot or other lots not encumbered by that declaration, and that Resolution 220 was void to the extent it purported to enforce such tree-trimming covenants in this manner. Colyear further alleged that some of the offending trees designated by Liu on [127] the photos attached to his application were on Colyear’s lot, thus Liu “sought to apply the Liu Application to cut back trees and plantings on Colyear’s lot.” Moreover, although Liu had withdrawn his application, Colyear alleged that Liu “expressly refused to acknowledge and agree” that he would not in the future “seek to enforce the Trees and Plantings Covenant against Colyear’s lot.”
The FAC also sought to quiet title “to Colyear’s lot against adverse claims” by defendants “in that each claims that Colyear’s lot is covered by the Trees and Plantings Covenant in Declaration 150, although Colyear’s lot is not covered by the Trees and Plantings Covenant, and seeks, or claims the right to seek, to enforce the Trees and Plantings Covenant against Colyear’s lot.” In addition, the FAC sought injunctive relief barring defendants from seeking to enforce the relevant covenant against Colyear’s lot or any other lots not encumbered by Declaration 150, as well as compensatory and punitive damages from the HOA and the board for alleged fraud and breaches of fiduciary duties.
C. Liu’s Anti-SLAPP Motion
Liu filed a special motion to strike the FAC pursuant to section 425.16, arguing that his view impairment application was protected under section 425.16(e)(4), as it constituted a written statement made in connection with an issue of public interest.[3] Further, he asserted Colyear could not establish a probability of success on his claims based on standing, mootness, and ripeness grounds.
Colyear opposed the motion to strike, arguing that Liu’s application to the HOA involved a private matter and thus was not protected conduct and that Colyear’s lawsuit did not arise out of the application, but rather from the “underlying controversy” regarding the proper application of Declaration 150. In his accompanying declaration, Colyear stated he had “confirmed” that two of the trees identified in Liu’s application were located on Colyear’s lot. Specifically, Colyear declared, “I [have] carefully reviewed the photograph or photographs attached to the Liu Application … which … has arrows added to it to point to trees that Liu requested to be cut…. I also walked my lot and the Krauthamers’ lot in the area where both lots meet the Liu property. Based on those observations, I now know for a fact that the trees and plantings that Liu claims in the Liu Application should be cut include two [128] trees on my lot.”[4] Colyear also declared his belief that “the Board’s acceptance of the Liu Application and initiation of proceedings for enforcement of the Trees and Plantings Covenant on behalf of Liu … clouds and encumbers the title to the Krauthamers’ lot and to my lot, as well as such other lots and decreases the utility and market value of those lots.” The Krauthamers both submitted declarations stating they “believed” one or two of the trees at issue was on Colyear’s lot.
Colyear attached numerous exhibits in support of his opposition, including Declarations 150 and 150-M, Resolution 220 and its predecessors, and Liu’s application. He also attached his correspondence to the board in 2002, as well as letters from several other homeowners on the same issue. In a letter dated September 4, 2002, addressed to the board and the attorney for the HOA, homeowner Philip Belleville referenced his presentation made at a prior hearing “on the proposed Resolution concerning trees and view,” and then reiterated his position that the proposed resolution should not purport to apply to all properties, including those not encumbered with a tree-trimming provision in the applicable CC&Rs. Belleville noted that, while he does “not have a view to protect,” he was nevertheless “vitally interested” in the issue, including the potential for exposure to expensive litigation against the HOA resulting in increased fees to the members and because “[i]t is very disturbing that the proposed Resolution exceeds the norms for such provisions of similar communities.” Belleville sent another letter in late 2005 objecting to proposed changes in Resolution 181 (a predecessor to 220), noting that the prior resolution had been adopted “after numerous hearings and public participation” and again objecting to language that could “wrongly cloud the property rights of the Members involved” and “lead to more costly and alienating litigation.” Another homeowner wrote a similar letter in 2015.
The trial court granted Liu’s motion. First, the court found Liu had met his burden to establish his conduct was protected under section 425.16(e)(4) because “the issue of view” was one of “general concern” to the homeowners in the community. Liu was “attempting to invoke the view covenants in his particular favor, but they are view covenants that impact, if not all, then a significant number of the people in this community association.” The trial court further found that Colyear’s lawsuit arose out of Liu’s protected conduct, noting that Liu’s application was the reason Colyear filed this action. Finally, the court found that Colyear had not carried his burden to show probability of success on the merits, particularly following the dismissal of Liu’s application.
[129] Colyear timely appealed the granting of the motion to strike.
DISCUSSION
I. Section 425.16 and Standard of Review
(1) “A SLAPP is a civil lawsuit that is aimed at preventing citizens from exercising their political rights or punishing those who have done so. `”While SLAPP suits masquerade as ordinary lawsuits such as defamation and interference with prospective economic advantage, they are 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.”‘ [Citations.]” (Simpson Strong-Tie Co., Inc. v. Gore (2010) 49 Cal.4th 12, 21 [109 Cal.Rptr.3d 329, 230 P.3d 1117] (Simpson).)
The Legislature has declared that “it is in the public interest to encourage continued participation in matters of public significance, and … this participation should not be chilled through abuse of the judicial process.” (§ 425.16, subd. (a).) To this end, the Legislature enacted section 425.16, subdivision (b)(1), which authorizes the filing of a special motion to strike for “[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 Constitution or the California Constitution in connection with a public issue.” “[T]he Legislature expressly provided that the anti-SLAPP statute `shall be construed broadly.’ (§ 425.16, subd. (a).)” (Simpson, supra, 49 Cal.4th at p. 21.)
(2) Analysis of a motion to strike pursuant to section 425.16 involves a two-step process. (Simpson, supra, 49 Cal.4th at p. 21.) “First, the defendant must make a prima facie showing that the plaintiff’s `cause of action … aris[es] from’ an act by the defendant `in furtherance of the [defendant’s] right of petition or free speech … in connection with a public issue.’ (§ 425.16, subd. (b)(1).) If a defendant meets this threshold showing, the cause of action shall be stricken unless the plaintiff can establish `a probability that the plaintiff will prevail on the claim.’ (Ibid.)” (Simpson, supra, 49 Cal.4th at p. 21, fn. omitted.) “Only a cause of action that satisfies both prongs of the anti-SLAPP statute — i.e., that arises from protected speech or petitioning and lacks even minimal merit — is a SLAPP, subject to be stricken under the statute.” (Navellier v. Sletten (2002) 29 Cal.4th 82, 89 [124 Cal.Rptr.2d 530, 52 P.3d 703], italics omitted.)
(3) We review a trial court’s decision on a special motion to strike de novo. (Flatley v. Mauro (2006) 39 Cal.4th 299, 325 [46 Cal.Rptr.3d 606, [130] 139 P.3d 2].) In engaging in the two-step process, we consider “the pleadings, and supporting and opposing affidavits stating the facts upon which the liability or defense is based.” (§ 425.16, subd. (b)(2).) “However, we neither `weigh credibility [nor] compare the weight of the evidence. Rather, [we] accept as true the evidence favorable to the plaintiff [citation] and evaluate the defendant’s evidence only to determine if it has defeated that submitted by the plaintiff as a matter of law.’ [Citation.]” (Soukup v. Law Offices of Herbert Hafif (2006) 39 Cal.4th 260, 269, fn. 3 [46 Cal.Rptr.3d 638, 139 P.3d 30] (Soukup).)
II. Liu’s Claims Arise From Protected Activity
(4) Under the first prong of a motion to strike under section 425.16, the moving party has the burden of showing that the cause of action arises from an act in furtherance of the right of free speech or petition — i.e., that it arises from a protected activity. (Zamos v. Stroud (2004) 32 Cal.4th 958, 965 [12 Cal.Rptr.3d 54, 87 P.3d 802].) Thus, the moving party must establish both (1) that its act constituted protected activity and (2) the opposing party’s cause of action arose from that protected activity. Colyear challenges Liu’s showing on both of these steps, so we examine each in turn.
A. Protected Activity
First, we must determine whether Liu’s speech was in fact protected conduct. To meet this burden, Liu must demonstrate that his statements fit one of the four categories of conduct set forth in section 425.16, subdivision (e): “(1) any written or oral statement or writing made before a legislative, 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.”
Liu asserts his conduct is protected under section 425.16, subdivision (e)(2) as a statement made in connection with an “official proceeding authorized by law,” or, alternatively, under subdivision (e)(4) as a statement made in connection with “an issue of public interest.” We agree that Liu’s conduct here is protected by section 425.16(e)(4); thus, we need not reach the issue of whether the HOA process is an “official proceeding” under subdivision (e)(2).
(5) Colyear argues that Liu’s application involved a private tree-trimming dispute between two neighbors and therefore does not qualify as a matter of [131] “public interest.” “Section 425.16 does not define `an issue of public interest.’ Nevertheless, the statute requires the issue to include attributes that make it one of public, rather than merely private, interest. [Citation.] A few guiding principles can be gleaned from decisional authorities. For example, `public interest’ is not mere curiosity. Further, the matter should be something of concern to a substantial number of people. Accordingly, a matter of concern to the speaker and a relatively small, specific audience is not a matter of public interest. Additionally, there should be a degree of closeness between the challenged statements and the asserted public interest. The assertion of a broad and amorphous public interest that can be connected to the specific dispute is not sufficient. [Citation.] One cannot focus on society’s general interest in the subject matter of the dispute instead of the specific speech or conduct upon which the complaint is based.” (Grenier v. Taylor (2015) 234 Cal.App.4th 471, 481 [183 Cal.Rptr.3d 867] (Grenier).)
(6) Cases that have found an issue of public interest have done so where “the subject statements either concerned a person or entity in the public eye [citations], conduct that could directly affect a large number of people beyond the direct participants [citations] or a topic of widespread, public interest [citation].” (Rivero v. American Federation of State, County and Municipal Employees, AFL-CIO (2003) 105 Cal.App.4th 913, 924 [130 Cal.Rptr.2d 81] (Rivero).)
Within these parameters, “`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.”‘ (Du Charme v. International Brotherhood of Electrical Workers (2003) 110 Cal.App.4th 107, 115 [1 Cal.Rptr.3d 501]….)” (Ruiz v. Harbor View Community Assn. (2005) 134 Cal.App.4th 1456, 1468 [37 Cal.Rptr.3d 133] (Ruiz).) “[I]n cases where the issue is not of interest to the public at large, but rather to a limited, but definable portion of the public (a private group, organization, or community), the constitutionally protected activity must, at a minimum, occur in the context of an ongoing controversy, dispute or discussion, such that it warrants protection by a statute that embodies the public policy of encouraging participation in matters of public significance.” (Du Charme, supra, 110 Cal.App.4th at p. 119, italics omitted; see also Grenier, supra, 234 Cal.App.4th at p. 482.)
Applying these principles, several courts have found protected conduct in the context of disputes within a homeowners association. In Ruiz, for example, a homeowner sued his homeowners association, alleging letters written by association counsel defamed him. (Ruiz, supra, 134 Cal.App.4th at pp. 1463-1465.) The letters concerned a dispute over the association’s rejection of Ruiz’s building plans, and Ruiz’s complaints that the association was not applying its architectural guidelines evenhandedly. (Ibid.) The court concluded the letters fell within section 425.16(e)(4), noting, (a) the letters [132] were written during an ongoing dispute between Ruiz and the association over denial of Ruiz’s plans and the application of the association’s architectural guidelines, and (b) the dispute was of interest to a definable portion of the public, i.e., residents of 523 lots, because they “would be affected by the outcome of those disputes and would have a stake in [association] governance.” (Ruiz, at p. 1468.) Moreover, the attorney’s letters “were part of the ongoing discussion over those disputes and `contribute[d] to the public debate’ on the issues presented by those disputes. [Citation.]” (Id. at p. 1469.)
Similarly, in Country Side Villas Homeowners Assn. v. Ivie (2011) 193 Cal.App.4th 1110, 1113 [123 Cal.Rptr.3d 251], the homeowner raised objections with her homeowners association over a change in practices regarding whether individual homeowners or the association had responsibility to pay for maintaining balconies and siding on individual units. The association filed suit against Ivie, seeking declaratory relief in interpreting the association’s governing documents regarding maintenance obligations. (Ibid.) The court found that Ivie’s complaints to the board were a matter of public interest, because her statements concerned issues “that affected all members of the association,” including whether all members would have to pay for maintenance costs assumed by the association. (Id. at p. 1118; see also Damon v. Ocean Hills Journalism Club (2000) 85 Cal.App.4th 468, 479 [102 Cal.Rptr.2d 205] [protecting allegedly defamatory statements about the competence of a manager of a homeowners association]; Lee v. Silveira(2016) 6 Cal.App.5th 527, 540 [211 Cal.Rptr.3d 705] [protecting complaints by homeowners association board members against other board members regarding board’s decisionmaking process in approving a large roofing project and a management company contract, as affecting “a broad segment, if not all,” association members]; Grenier, supra, 234 Cal.App.4th at p. 483 [defamatory statements accusing church pastor of theft and misuse of church funds, and of abuse, are of interest to the church’s 500 or more members, and therefore are of “public interest”]; Ludwig v. Superior Court(1995) 37 Cal.App.4th 8, 15 [43 Cal.Rptr.2d 350] [concluding that development of a mall, “with potential environmental effects such as increased traffic and impaction on natural drainage, was clearly a matter of public interest”].) By contrast, in Rivero, supra, 105 Cal.App.4th at p. 924, the court rejected anti-SLAPP protection for complaints in a union newsletter alleging a janitorial supervisor mistreated his employees. The court held that the allegedly defamatory statements were not a matter of public interest as they concerned “the supervision of a staff of eight custodians by Rivero, an individual who had previously received no public attention.” (Ibid.)
(7) Here, the record presents sufficient evidence to sustain Liu’s burden that at the time he submitted his application, there was an ongoing controversy, dispute, or discussion regarding the applicability of tree-trimming covenants to lots not expressly burdened by them, and the HOA’s authority to [133] enforce such covenants. While the evidence in the record is somewhat sparse, it is sufficient to show that 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, as he invoked the process under Resolution 220 to request authority from the board to trim trees on a neighbor’s property that admittedly was not expressly burdened by Declaration 150. Indeed, this is the crux of Colyear’s argument for injecting himself into this dispute — that Liu’s conduct in submitting the application unleashed a process unfair to Colyear and all other homeowners not subject to a tree-trimming covenant and thereby clouded his title with an improper encumbrance. As such, Colyear’s current suggestion that Liu’s application involves nothing more than a private tree-trimming dispute between two neighbors is unavailing.
Colyear does not dispute that the issue of the board’s authority to apply tree-trimming covenants to all lots in the community is a subject of interest to the entire membership of the community, and therefore meets the definition of “public interest” under section 425.16(e)(4). (See, e.g., Damon v. Ocean Hills Journalism Club, supra, 85 Cal.App.4th at p. 479 [“Although the allegedly defamatory statements were made in connection with the management of a private homeowners association, they concerned issues of critical importance to a large segment of our local population. `For many Californians, the homeowners association functions as a second municipal government….’ [Citation.]”].) Instead, he argues that the proper focus for this step in the anti-SLAPP inquiry must be much narrower, and that here, Liu’s application only directly involved two homeowners — Liu and the Krauthamers — and was therefore a private dispute rather than an issue of public interest. Colyear further asserts that to the extent his complaint raised the broader issues of enforceability of the tree-trimming covenant and HOA governance, his conduct cannot serve to insulate Liu’s statements. We agree with the principle that we must avoid looking to “society’s general interest in the subject matter of the dispute instead of the specific speech or conduct upon which the complaint is based.” (World Financial Group, Inc. v. HBW Ins. & Financial Services, Inc. (2009) 172 Cal.App.4th 1561, 1570 [92 Cal.Rptr.3d 227]; see also Commonwealth Energy Corp. v. Investor Data Exchange, Inc. (2003) 110 Cal.App.4th 26, 34 [1 Cal.Rptr.3d 390] [cautioning against the “synecdoche theory of public issue in the anti-SLAPP statute,” where “[t]he part [is considered] synonymous with the greater whole”].)
However, we are not persuaded that Liu’s statement here lacks the requisite degree of closeness with the asserted public interest. As discussed, Liu’s application itself invoked the same HOA processes that Colyear (and other community members) sought to challenge. The cases rejecting anti-SLAPP [134] protection on this basis involve a much greater level of abstraction to a “`”broad and amorphous public interest,”‘” and are thus distinguishable. (World Financial Group, Inc. v. HBW Ins. & Financial Services, Inc., supra, 172 Cal.App.4th at p. 1570 [rejecting defendants’ attempt to tie their conduct — allegedly reaching out to their former employer’s customers to promote a competitor business — to broader issues of employee mobility and competition]; see also, e.g., Consumer Justice Center v. Trimedica International, Inc. (2003) 107 Cal.App.4th 595, 601 [132 Cal.Rptr.2d 191] [“Trimedica’s speech is not about herbal supplements in general. It is commercial speech about the specific properties and efficacy of a particular product.”]; Commonwealth Energy Corp. v. Investor Data Exchange, Inc., supra, 110 Cal.App.4th at p. 34 [“hawking an investigatory service is not an economics lecture on the importance of information for efficient markets”].) Accordingly, we conclude Liu has established he made a statement in connection with an issue of public interest within the meaning of section 425.16(e)(4).
B. Claim Arises From Protected Activity
We next turn to Colyear’s claim that, even if Liu’s statement was protected, Colyear’s complaint did not arise out of that statement. We disagree.
(8) “Our Supreme Court has recognized the anti-SLAPP statute should be broadly construed [citation] and that a plaintiff cannot avoid operation of the anti-SLAPP statute by attempting, through artifices of pleading, to characterize an action as a garden variety tort or contract claim when in fact the claim is predicated on protected speech or petitioning activity. [Citation.] Accordingly, we disregard the labeling of the claim [citation] and instead `examine the principal thrust or gravamen of a plaintiff’s cause of action to determine whether the anti-SLAPP statute applies’…. [Citation.]” (Hylton v. Frank E. Rogozienski, Inc. (2009) 177 Cal.App.4th 1264, 1271-1272 [99 Cal.Rptr.3d 805].) We assess the principal thrust by identifying “[t]he allegedly wrongful and injury-causing conduct … that provides the foundation for the claim.” (Martinez v. Metabolife Internat., Inc. (2003) 113 Cal.App.4th 181, 189 [6 Cal.Rptr.3d 494].) “If the core injury-producing conduct upon which the plaintiff’s claim is premised does not rest on protected speech or petitioning activity, collateral or incidental allusions to protected activity will not trigger application of the anti-SLAPP statute. [Citation.]” (Hylton, supra, 177 Cal.App.4th at p. 1272.) “[T]he critical point is whether the plaintiff’s cause of action itself was based on an act in furtherance of the defendant’s right of petition or free speech.” (City of Cotati v. Cashman (2002) 29 Cal.4th 69, 78 [124 Cal.Rptr.2d 519, 52 P.3d 695], italics omitted.) “In other words, `the defendant’s act underlying the plaintiff’s cause of action must itselfhave been an act in furtherance of the right of petition or free speech. [Citation.]'” [135] (Peregrine Funding, Inc. v. Sheppard Mullin Richter & Hampton LLP (2005) 133 Cal.App.4th 658, 670 [35 Cal.Rptr.3d 31].)
Colyear argues that the dispute here arose from “the question of the applicability of a tree-trimming covenant”; conversely, he argues, “Liu’s application to enforce the covenant against Colyear’s property was simply the trigger for Colyear’s suit to resolve that question.” He further notes that the trial court’s reliance on “but-for causation” in analyzing the issue was therefore in error. To the extent the trial court focused on whether Liu’s application caused Colyear to file a lawsuit, such an analysis would provide an insufficient basis from which to find that Liu had established the lawsuit arose out of his protected conduct. Based on our independent review, however, we conclude that Liu did make the requisite showing.
Liu’s application did not simply “trigger” Colyear’s lawsuit, as Colyear claims. Rather, the gravamen of Colyear’s claims against Liu was the allegation that by submitting an application to the HOA concerning property unencumbered by Declaration 150, Liu invoked an invalid HOA process and clouded Colyear’s title. As such, the only injury-producing conduct Colyear alleges Liu committed was Liu’s petitioning act.
These circumstances are factually distinct from cases, including those cited by Colyear, in which the defendant’s protected speech was ancillary to the heart of the plaintiff’s claims. In City of Cotati v. Cashman, supra, 29 Cal.4th at pp. 71, 72 for example, owners of mobilehome parks brought a declaratory relief action against the city in federal court seeking a judicial determination that the city’s mobilehome park rent-control ordinance constituted an unconstitutional taking. In response, the city sued the park owners in state court, also requesting a declaration regarding the constitutionality and enforceability of the rent-control ordinance. (Id. at p. 72.) The city conceded that its state lawsuit was triggered by the federal action and was an attempt to “gain a more favorable forum” in which to litigate the issue. (Id. at p. 73.) As the Supreme Court explained, “the mere fact an action was filed after protected activity took place does not mean it arose from that activity.” (Id. at pp. 76-77.) Instead, because the “fundamental basis” for both actions was the “same underlying controversy respecting [the rent control] ordinance,” the city’s lawsuit “therefore was not one arising from [the park owners’] federal suit” and “was not subject to a special motion to strike.” (Id. at p. 80; see also, e.g., Talega Maintenance Corp. v. Standard Pacific Corp. (2014) 225 Cal.App.4th 722, 729 [170 Cal.Rptr.3d 453][homeowners association’s claim against board members arose from “the act of spending money in violation of [the board members’] fiduciary duties,” not from the vote that precipitated such expenditure]; McConnell v. Innovative Artists Talent and Literary Agency, Inc. (2009) 175 Cal.App.4th 169, 176-177 [96 Cal.Rptr.3d 1] [talent [136] agents’ claims against former employer for retaliation and wrongful termination were based on employer’s course of conduct preventing the agents from performing their work, not the letter that communicated the purported job modifications]; Martinez v. Metabolife Internat., Inc., supra, 113 Cal.App.4th at p. 189 [holding that “the gravamen of Plaintiffs’ second cause of action, alleging the Product was not merchantable because it contained dangerous properties and ingredients that caused injury, is based on the nature and effects of the Product itself, not the marketing efforts undertaken by” the defendant].) Here, by contrast, Liu’s protected conduct — his application to the HOA — served as the foundation for Colyear’s claims against him.
In sum, we conclude that Liu met his burden on the first prong of the anti-SLAPP motion to strike. We therefore turn to the second prong, i.e., whether Colyear met his burden to demonstrate a probability of prevailing on his claims against Liu.
III. Colyear Cannot Demonstrate a Probability of Prevailing Against Liu
(9) Once a defendant satisfies the first prong of the anti-SLAPP analysis, “the burden shifts to the plaintiff to demonstrate that each challenged claim based on protected activity is legally sufficient and factually substantiated. The court, without resolving evidentiary conflicts, must determine whether the plaintiff’s showing, if accepted by the trier of fact, would be sufficient to sustain a favorable judgment. If not, the claim is stricken.” (Baral v. Schnitt (2016) 1 Cal.5th 376, 396 [205 Cal.Rptr.3d 475, 376 P.3d 604].) “In making this assessment it is `the court’s responsibility … to accept as true the evidence favorable to the plaintiff….’ [Citation.] The plaintiff need only establish that his or her claim has `minimal merit’ [citation] to avoid being stricken as a SLAPP.” (Soukup, supra, 39 Cal.4th at p. 291.)
(10) Colyear contends he has shown his likelihood of success on his quiet title claim against Liu with evidence that (1) he has title and (2) Liu made a claim adverse to that title by invoking the tree-trimming covenant against Colyear’s property. However, the trial court found that Colyear’s quiet title claim against Liu was mooted by the withdrawal of Liu’s application. We agree. Assuming Liu’s application implicated Colyear’s property when filed, Liu withdrew his application before any action was taken, leaving no pending challenges against Colyear’s property. Thus, at the time Colyear filed his FAC, there was no “adverse claim” by Liu against Colyear’s property (§§ 760.020, 761.020 [elements to quiet title claim]), and no effective relief the court could grant against Liu. (See, e.g., Giles v. Horn (2002) 100 Cal.App.4th 206, 227 [123 Cal.Rptr.2d 735] [court “`cannot render opinions “`… upon moot questions or abstract propositions, or to declare principles or rules of law which cannot affect the matter in issue in the case before [137]it'”‘”]; Wilson v. L. A. County Civil Service Com. (1952) 112 Cal.App.2d 450, 453 [246 P.2d 688] [“`although a case may originally present an existing controversy, if before decision it has, through act of the parties or other cause, occurring after the commencement of the action, lost that essential character, it becomes a moot case or question which will not be considered by the court'”].)[5] In light of these findings, we need not reach the parties’ alternate arguments regarding ripeness, standing, or the admissibility of Colyear’s statements regarding ownership of the trees.
As such, we conclude that Colyear has not shown a probability of success on the merits of his quiet title claim.
DISPOSITION
The order granting Liu’s motion to strike pursuant to section 425.16 is affirmed. Liu is awarded his costs on appeal.
Epstein, P. J., and Manella, J., concurred.
[1] SLAPP is an acronym for strategic lawsuit against public participation. All further statutory references are to the Code of Civil Procedure unless stated otherwise.
[2] Whether other, more general language in Declaration 150-M could be applied to confer the same authority, as Liu seems to suggest, is not at issue in this appeal.
[3] Liu’s motion also stated in passing that his conduct should be protected under section 425.16(e)(2) as a statement “made in connection with an issue under consideration or review” by an “official proceeding authorized by law,” but offered no other argument or citation on this point.
[4] The trial court subsequently granted Liu’s objections to multiple paragraphs in Colyear’s declaration, including these statements regarding the placement of two trees. During oral argument, the court noted Colyear’s declaration provided no foundation for how Colyear “knew where the boundary line” lay between his and the Krauthamers’ property and that Colyear’s statements were conclusory.
[5] Colyear argues that the trial court should have considered his claim because Liu’s conduct was capable of repetition, yet could continue to evade the courts’ review. Colyear has raised this argument for the first time on appeal; it is therefore forfeited. (See, e.g., Sanchez v. Truck Ins. Exchange (1994) 21 Cal.App.4th 1778, 1787 [26 Cal.Rptr.2d 812].) We are not persuaded by Colyear’s suggestion that we may review this issue as a “`”pure question of law which is presented by undisputed facts.” [Citation.]'” (Ibid.)
(a) When reviewing a request to install a solar energy system on a multifamily common area roof shared by more than one homeowner pursuant to Sections 714 and 714.1, an association shall require both of the following:
(1) An applicant to notify each owner of a unit in the building on which the installation will be located of the application to install a solar energy system.
(2) The owner and each successive owner to maintain a homeowner liability coverage policy at all times and provide the association with the corresponding certificate of insurance within 14 days of approval of the application and annually thereafter.
(b) When reviewing a request to install a solar energy system on a multifamily common area roof shared by more than one homeowner pursuant to Sections 714 and 714.1, an association may impose additional reasonable provisions that:
(1)
(A) Require the applicant to submit a solar site survey showing the placement of the solar energy system prepared by a licensed contractor or the contractor’s registered salesperson knowledgeable in the installation of solar energy systems to determine usable solar roof area. This survey or the costs to determine useable space shall not be deemed as part of the cost of the system as used in Section 714.
(B) The solar site survey shall also include a determination of an equitable allocation of the usable solar roof area among all owners sharing the same roof, garage, or carport.
(2) Require the owner and each successive owner of the solar energy system to be responsible for all of the following:
(A) Costs for damage to the common area, exclusive use common area, or separate interests resulting from the installation, maintenance, repair, removal, or replacement of the solar energy system.
(B) Costs for the maintenance, repair, and replacement of solar energy system until it has been removed and for the restoration of the common area, exclusive use common area, or separate interests after removal.
(C) Disclosing to prospective buyers the existence of any solar energy system of the owner and the related responsibilities of the owner under this section.
(c) For purposes of this section:
(1) “Association” has the same meaning as defined in Section 4080 or 6528.
(2) “Common area” has the same meaning as defined in Section 4095 or 6532.
(3) “Separate interest” has the same meaning as defined in Section 4185 or 6564.
(d) This section imposes additional requirements for any proposed installation of a solar energy system on a multifamily common area roof shared by more than one homeowner.
(e) This section does not diminish the authority of an association to impose reasonable provisions pursuant to Section 714.1.
(a) It is the intent of the Legislature to ensure that members and residents of common interest developments have the ability to exercise their rights under law to peacefully assemble and freely communicate with one another and with others with respect to common interest development living or for social, political, or educational purposes.
(b) The governing documents, including bylaws and operating rules, shall not prohibit a member or resident of a common interest development from doing any of the following:
(1) Peacefully assembling or meeting with members, residents, and their invitees or guests during reasonable hours and in a reasonable manner for purposes relating to common interest development living, association elections, legislation, election to public office, or the initiative, referendum, or recall processes.
(2) Inviting public officials, candidates for public office, or representatives of homeowner organizations to meet with members, residents, and their invitees or guests and speak on matters of public interest.
(3) Using the common area, including the community or recreation hall or clubhouse, or, with the consent of the member, the area of a separate interest, for an assembly or meeting described in paragraph (1) or (2) when that facility or separate interest is not otherwise in use.
(4) Canvassing and petitioning the members, the association board, and residents for the activities described in paragraphs (1) and (2) at reasonable hours and in a reasonable manner.
(5) Distributing or circulating, without prior permission, information about common interest development living, association elections, legislation, election to public office, or the initiative, referendum, or recall processes, or other issues of concern to members and residents at reasonable hours and in a reasonable manner.
(6)
(A) Using social media or other online resources to discuss any of the following, even if the content is critical of the association or its governance:
(i) Development living.
(ii) Association elections.
(iii) Legislation.
(iv) Election to public office.
(v) The initiative, referendum, or recall processes.
(vi) Any other issues of concern to members and residents.
(B) This paragraph does not require an association to provide social media or other online resources to members.
(C) This paragraph does not require an association to allow members to post content on the association’s internet website.
(c) A member or resident of a common interest development shall not be required to pay a fee, make a deposit, obtain liability insurance, or pay the premium or deductible on the association’s insurance policy, in order to use a common area for the activities described in paragraphs (1), (2), and (3) of subdivision (b).
(d) A member or resident of a common interest development who is prevented by the association or its agents from engaging in any of the activities described in this section may bring a civil or small claims court action to enjoin the enforcement of a governing document, including a bylaw and operating rule, that violates this section. The court may assess a civil penalty of not more than five hundred dollars ($500) for each violation.
(a) A “transfer fee” is any fee payment requirement imposed within a covenant, restriction, or condition contained in any deed, contract, security instrument, or other document affecting the transfer or sale of, or any interest in, real property that requires a fee be paid as a result of transfer of the real property. A transfer fee does not include any of the following:
(1) Fees or taxes imposed by a governmental entity.
(2) Fees pursuant to mechanics’ liens.
(3) Fees pursuant to court-ordered transfers, payments, or judgments.
(4) Fees pursuant to property agreements in connection with a legal separation or dissolution of marriage.
(5) Fees, charges, or payments in connection with the administration of estates or trusts pursuant to Division 7 (commencing with Section 7000), Division 8 (commencing with Section 13000), or Division 9 (commencing with Section 15000) of the Probate Code.
(6) Fees, charges, or payments imposed by lenders or purchasers of loans, as these entities are described in subdivision (c) of Section 10232 of the Business and Professions Code.
(7) Assessments, charges, penalties, or fees authorized by the Davis-Stirling Common Interest Development Act (Part 5 (commencing with Section 4000) of Division 4) or by the Commercial and Industrial Common Interest Development Act (Part 5.3 (commencing with Section 6500) of Division 4).
(8) Fees, charges, or payments for failing to comply with, or for transferring the real property prior to satisfying, an obligation to construct residential improvements on the real property.
(9)
(A) Any fee reflected in a document recorded against the property on or before December 31, 2007, that is separate from any covenants, conditions, and restrictions, and that substantially complies with subdivision (a) of Section 1098.5 by providing a prospective transferee notice of the following:
(i) Payment of a transfer fee is required.
(ii) The amount or method of calculation of the fee.
(iii) The date or circumstances under which the transfer fee payment requirement expires, if any.
(iv) The entity to which the fee will be paid.
(v) The general purposes for which the fee will be used.
(B) A fee reflected in a document recorded against the property on or before December 31, 2007, that is not separate from any covenants, conditions, and restrictions, or that incorporates by reference from another document, is a “transfer fee” for purposes of Section 1098.5. A transfer fee recorded against the property on or before December 31, 2007, that complies with subparagraph (A) and incorporates by reference from another document is unenforceable unless recorded against the property on or before December 31, 2016, in a single document that complies with subdivision (b) and with Section 1098.5.
(b) The information in paragraph (9) of subdivision (a) shall be set forth in a single document and shall not be incorporated by reference from any other document.
*Note- This section shall become operative on January 1, 2018. For more information, see AB 534.
(a) With respect to a work of improvement on a common area within a common interest development: (1) The association is deemed to be an agent of the owners of separate interests in the common interest development for all notices and claims required by this part. (2) If any provision of this part requires the delivery or service of a notice or claim to or on the owner of common area property, the notice or claim may be delivered to or served on the association.
(b) For the purposes of this section, the terms “association,” “common area,” “common interest development,” and “separate interest” have the meanings provided in Article 2 (commencing with Section 4075) of Chapter 1 of Part 5 and Article 2 (commencing with Section 6526) of Chapter 1 of Part 5.3.
The common interest development manager, common interest development management firm, or its contracted third-party agent shall facilitate the delivery of disclosures required pursuant to paragraph (1) of subdivision (a), paragraph (2) of subdivision (b), and subdivision (d), of Section 4530 if the common interest development manager, or common interest development management firm, is contractually responsible for delivering those documents.
A common interest development manager or common interest development management firm shall disclose, in writing, any potential conflict of interest when presenting a bid for service to an association’s board of directors. “Conflict of interest,” for purposes of this section, means:
(a) Any referral fee or other monetary benefit that could be derived from a business or company providing products or services to the association.
(b) Any ownership interests or profit-sharing arrangements with service providers recommended to, or used by, the association.
If the association is served with a claim of lien pursuant to Part 6 (commencing with Section 8000) for a work of improvement on a common area, the association shall, within 60 days of service, give individual notice to the members, pursuant to Section 4040.
(2017) 10 Cal.App.5th 24
[Membership List; Inspection Denial] A homeowners association (HOA) may restrict a member’s request for access to the HOA’s membership list when the request is for an improper purpose.
Wheeler & Associates and David C. Wheeler for Defendant and Appellant.
Wilson Keadjian Browndorf, Marc Y Lazo and Charles K. Stec for Plaintiff and Appellant.
OPINION
SORTINO, J.*—A member of a nonprofit mutual benefit corporation requested inspection of the corporation’s membership list, and other books and records. The corporation refused, and the member brought a petition for writ of mandate to compel inspection. The trial court agreed with the corporation that the member sought the inspection for an improper purpose, unrelated to his interest as a member of the corporation. As a result, the court denied the petition with respect to the books and records. However, the court concluded the corporation did not timely challenge the request for the membership list as required by statute, and therefore ordered the list disclosed. Both parties appeal. We conclude (1) substantial evidence supports the trial court’s finding that the member sought the information for an improper purpose and (2) the corporation’s challenge to disclosing the membership list was not barred [28] by statute. We therefore reverse that part of the court’s judgment requiring disclosure of the membership list, and otherwise affirm.
FACTUAL AND PROCEDURAL BACKGROUND
Don Parker is a member of Tract No. 7260 Association, Inc., a nonprofit homeowners association (the HOA). This action arises out of his request for inspection of the HOA’s membership list and other records. As far as the HOA is concerned, though, the action also arises out of a dispute the HOA has with another entity known as Fix the City.
Parker used to be the treasurer of the HOA. When Parker was treasurer, a man named Michael Eveloff was the President. Eveloff created Fix the City. According to the HOA, it had been granted the right to control a substantial amount of money. However, Eveloff convinced the HOA board to transfer that money to Fix the City, which used it for purposes which were of no use to the HOA. The HOA is now suing Fix the City for usurping its corporate opportunity. The HOA believes that Parker is aligned with Eveloff and Fix the City, and that he sought access to the membership list and other HOA records [*3] to use them against the HOA in the dispute with Fix the City.
A. Parker’s Request
On January 29, 2015, the same day that the HOA filed suit against Fix the City (the “HOA/Fix the City” action), Parker requested seven categories of corporate information from the HOA, including its membership list. He stated legitimate reasons for which he sought the information. For example, he stated that he wanted to inspect the HOA’s books to make certain the HOA was following generally accepted accounting principles. He explained that he sought the membership list for possible communications with the members to ascertain whether there had been corporate misdeeds.
Parker sought the information under Corporations Code section 8330 et seq.1 Requests under those sections may be made by “[a]ny member” of the corporation (§ 8330, subd. (b)(1)) or by the “authorized number of members” (§ 8330, subd. (b)(2)). When the corporation has less than 1,000 voting members, the “authorized number” is 5 percent of voting power. (§ 5036.) As we shall discuss, different procedures apply depending on whether a single member, or the authorized number of members, is making the request. Parker made his request as “the undersigned member,” and signed it as “Homeowner—Tract 7260.” He did not state that he was [*4] acting for the authorized number of members, nor did he suggest that he had written authorizations from members holding sufficient voting power.
B. The HOA Largely Denies the Request
There is no serious dispute that the HOA did not fully comply with Parker’s request. A representative of the HOA met with Parker briefly and let him review certain of the documents he had sought—but not all of them, and not the membership list.
C. Parker Files His Petition
On April 6, 2015, Parker filed a petition for writ of mandate, seeking an order compelling the HOA to allow him to inspect and copy the membership list and the other books and records he had sought. As in his written request for inspection, Parker asserted he had a right to inspect “in his capacity as a member” of the HOA. The HOA answered the petition, arguing that Parker had no right to inspect because he sought the information for an improper purpose.
D. The HOA Fails to Have the Cases Related
On May 27, 2015, the HOA filed a notice of related case, in order to relate this case (Parker’s writ petition) to the HOA/Fix the City action. In its notice, the HOA argued that Parker was seeking inspection in this case in order to give Fix the [*5] City an unfair advantage in the HOA/Fix the City case. Parker opposed relation on both procedural and substantive grounds. On June 24, 2015, the court in the HOA/Fix the City case denied relation, stating that the writ petition must be decided in a writ and receivers department, and would not be moved to the civil department in which the HOA/Fix the City case was pending.
E. Briefing on the Writ Petition
The briefing on the merits of the writ petition turned to the issue of Parker’s reasons for seeking inspection of the membership list and other documents. Parker filed a declaration stating that he sought the information for legitimate reasons reasonably related to his interests as a member. He expressly represented that he did not make his demand “for any reason related to the other lawsuit subsequently filed by [the HOA] after I made the Demand.”
The HOA presented evidence as to why it believed Parker was, in fact, aligned with Fix the City, and seeking the inspection in order to improperly assist Fix the City in the HOA/Fix the City action. This included evidence of the following facts: (1) Parker had been aligned with Eveloff in convincing the HOA to transfer the corporate opportunity [*6] to Fix the City, which the HOA alleges Parker accomplished by misrepresentation; (2) the HOA’s then-lawyers gave the HOA an opinion that the transfer to Fix the City was lawful; (3) shortly after the transfer to Fix the City was approved by the HOA’s board, Parker and Eveloff simultaneously resigned, effective April 7, 2013; (4) on April 5, 2013, the last business day prior to his resignation, Parker e-mailed the HOA’s bank with an emergency request for a cashier’s check for nearly $49,000 to the attorneys who had opined on the legality of the transfer; (5) the HOA’s current treasurer can conceive of no “legitimate reason” why it would be in the HOA’s interest to pay the attorneys with a cashier’s check or to speed such a payment through as a treasurer’s last official act; (6) that same law firm has since represented Fix the City in other cases (but not the HOA/Fix the City case); and (7) Parker’s counsel in the current writ case is the same firm that is presently representing Fix the City in the HOA/Fix the City case.
In short, the HOA painted the picture of a treasurer who, by misrepresentations and aided by a possibly biased legal opinion, convinced the board to transfer an opportunity [*7] to Fix the City; then quit the board, making certain that the lawyers were paid off; and is now represented by the same firm that is defending Fix the City against the HOA’s allegation that the transfer was improper.
F. The Trial Court Grants the Writ in Part
The trial court recognized that the law requires a member seeking membership lists and other corporate records to have a purpose related to his interests as a member. The court considered the facts and concluded that Parker’s purpose was improper, stating, “Particularly since Parker approved the transfer to Fix the City and his lawyer is defending Fix the City in [the] lawsuit, a reasonable conclusion is that Parker is using his membership status to aid Fix the City in defending the [HOA/Fix the City] lawsuit.”
Based on this factual finding, the court denied Parker’s request for corporate books and records under section 8333. However, the court concluded the membership list must be disclosed. The court relied on section 8331, subdivision (i), which provides that, when a demand for membership lists is made by an authorized number of members, the corporation must seek an order setting aside the demand. If it does not do so, the requesting parties may seek mandamus and “[n]o [*8] inquiry may be made in such proceeding into the use for which the authorized number seek the list.” As the HOA did not timely seek a set-aside order, the court concluded, the HOA’s defense of improper purpose came too late insofar as the request involved the membership list.
G. Further Proceedings
Each party prepared a proposed judgment; each party objected to the other’s proposed judgment. Specifically, the HOA believed the trial court had erred in relying on section 8331, subdivision (i) to allow Parker to access the membership list, as that provision applies only when the “authorized number” seeks a membership list, not when a single member does so. The HOA’s counsel wrote Parker’s counsel suggesting that the court relied on this statute due to Parker’s counsel having misrepresented the law in this regard, and requesting that he inform the court of his error. Parker believed section 8331, subdivision (i) applied, and, in any event, it was too late for the HOA to raise the issue, as it would turn on the factual issue of whether Parker alone constituted the “authorized number” of members—an issue on which neither party had introduced evidence.
H. Judgment, Appeal, and Cross-Appeal
The trial court signed a judgment consistent with its ruling, [*9] granting Parker access to the membership list only. Both parties timely appealed.
DISCUSSION
On appeal, the HOA argues that the court erred in concluding the HOA was procedurally barred from challenging Parker’s purpose in seeking the membership list and that, instead, the court’s finding of Parker’s improper purpose should bar him from inspecting the membership list as well as the other documents. In his cross-appeal, Parker argues that the evidence of improper purpose is insufficient as a matter of law, and his mere assertion of a single proper purpose is sufficient to justify inspection. Considering the cross-appeal first, we conclude the evidence is sufficient to support the trial court’s finding of improper purpose, and that Parker’s assertion of a proper purpose does not defeat this finding. Turning to the HOA’s appeal, we conclude that the court erred in applying the “authorized number” law to Parker’s single member request. Under the proper authority, the HOA timely raised the issue of Parker’s improper purpose, and the court therefore should have also refused Parker’s request to inspect the membership list.
A. Parker Sought the Information for an Improper Purpose
(1) A member’s right [*10] of inspection is limited to purposes reasonably related to the member’s interests as a member. (§§ 8330, subd. (b)(1) [membership lists], 8333 [corporate financial records].) “This limitation is always subject to judicial review to determine whether a lawful purpose exists.” (Dandini v. Superior Court (1940) 38 Cal.App.2d 32, 35 [100 P.2d 535].) A corporation has the burden of proving that the member “will allow use of the information for purposes unrelated to the person’s interest as a member.” (WorldMark, The Club v. Wyndham Resort Development Corp. (2010) 187 Cal.App.4th 1017, 1029 [114 Cal. Rptr. 3d 546].) On appeal, we review the trial court’s order for substantial evidence. (Ibid.) (2) Mere speculation that the member will use the information for an improper purpose is not sufficient to nullify inspection rights; any suspicion must be based on adequate facts in order to justify denial of inspection. (Gilmore v. Emsco Derrick & Equipment Co. (1937) 22 Cal.App.2d 64, 67 [70 P.2d 251] [improper to deny shareholder inspection rights simply because she was employed by a detective agency, when there was no evidence her inspection demand was related to her employment].)
Here, Parker contends the court’s finding of improper purpose is unsupported by the evidence, as it is mere suspicion based on the fact that Parker’s counsel is currently representing Fix the City in “unrelated” litigation. In Parker’s briefing, he repeatedly characterizes the HOA/Fix the City case as [*11] “unrelated,” because the judge in the HOA/Fix the City matter refused to relate the two cases. But the court’s order declining to relate the cases was made on the procedural basis that a writ petition should remain in the writ department; it did not conclude that the two cases were factually unrelated. Indeed, they are factually related. The HOA/Fix the City litigation challenges a transfer which Parker himself recommended, allegedly by misrepresentations. That Parker is pursuing his inspection claim aided by the same counsel defending Fix the City in the HOA/Fix the City litigation certainly gives rise to the reasonable inference that Parker seeks the information to aid Fix the City in defending against that action. Parker argues that this cannot be the case, in that the HOA/Fix the City complaint was not filed until the day he served his inspection demand, and he did not learn of the complaint until it was served on Fix the City some weeks later. But this does not mean that Parker did not know that litigation was imminent, and does not undermine the conclusion that he sought inspection to defend Fix the City against the complaint that he knew was coming.
Moreover, the fact that Parker’s [*12] counsel is representing Fix the City in the HOA/Fix the City litigation is not the only fact supporting the trial court’s conclusion. That Parker and Eveloff simultaneously resigned from the board after pushing through the transfer to Fix the City tends to show Parker is aligned with the HOA’s litigation adversary. That Parker made certain that the HOA’s former counsel, which now represents Fix the City in other matters, was paid by a cashier’s check on an emergency basis confirms the conclusion. The court’s finding that Parker’s purpose was improper is supported by substantial evidence.
(3) Parker also argues that, even if he did have a “secondary” improper purpose, the fact that he asserted a proper purpose, related to his interests as a member, is sufficient to justify his inspection demand. Parker’s authority for this remarkable proposition is Private Investors v. Homestake Mining Co. (1936) 11 Cal.App.2d 488 [54 P.2d 535]. That case does not support the argument. In Homestake Mining, the trial court overruled a corporation’s demurrer to a shareholder’s complaint seeking to enforce inspection rights, and, as the corporation had filed no answer, issued a writ. The corporation sought a writ of supersedeas to stay enforcement pending its appeal. The court, therefore, [*13] was tasked with determining whether the appeal presented a substantial or debatable question. (Id. at p. 496.) One of the corporation’s arguments in its demurrer was that the shareholder’s complaint did not allege that the purposes for which inspection was sought were reasonably related to the plaintiff’s interests as a shareholder, although the reasons themselves had been alleged. The appellate court concluded the corporation’s argument was utterly meritless, in that two of the four reasons alleged by the plaintiff shareholder had been held, in another case, to be reasonably related to shareholders’ interests. The court stated that any one of the four reasons would have been sufficient for the demand, and concluded, “the additional allegation that any one of these alleged purposes was ‘reasonably’ related to the shareholder’s interest would have been but a conclusion of law.” (Id. at p. 497.) In other words, the court held only that when a plaintiff alleges a purpose reasonably related to the plaintiff’s interests as a shareholder, the plaintiff need not also allege the legal conclusion that the purpose was, in fact, reasonably related to the plaintiff’s interests as a shareholder. The court did not hold that [*14] the mere allegation of a proper purpose is sufficient to require inspection when the court has found other, improper purposes are actually motivating the shareholder.2
As the court’s finding that Parker’s purpose was improper is supported by substantial evidence, and Parker’s assertion of a proper purpose does not undermine the conclusion, the trial court did not err in denying Parker inspection of all books and records other than the membership list.
B. Parker’s Improper Purpose Defeats Inspection of the Membership List
We now turn to the HOA’s appeal, which requires a discussion of the procedures that apply when a single member, as opposed to an “authorized number” of members, seeks inspection of a nonprofit corporation’s membership list. This is a legal issue of statutory interpretation, which we review de novo. (Rodriguez v. Solis (1991) 1 Cal.App.4th 495, 502 [2 Cal. Rptr. 2d 50].)
(4) Section 8330, subdivision (a) provides for a right of membership list inspection. Subdivision (b) explains that this right applies to (1) any member and (2) the authorized number of members. Both can inspect only for a purpose reasonably related to their interest as members. The statutes provide for different procedures, however, when the corporation believes inspection is sought for an improper purpose. [*15]
If a demand is made by a single member and the corporation believes the demand is for an improper purpose, the corporation “may deny the member access to the list. In any subsequent action brought by the member [to enforce inspection], the court shall enforce the [inspection right] unless the corporation proves that the member will allow use of the information for purposes unrelated to the person’s interest as a member … .” (§ 8330, subd. (b)(1).)
(5) In contrast, if the demand is made by the authorized number of members, and the corporation believes the demand is for an improper purpose, the corporation “may petition the superior court … for an order setting aside the demand.” (§ 8331, subd. (a).) The corporation has only 10 business days in which to file its petition; this may be extended to 30 days, upon a showing of excusable neglect. (§ 8331, subds. (b) & (c).) If the corporation does not act within that time limit, it “shall comply with the demand … .” (§ 8331, subd. (e).) Where the corporation has not timely sought an order setting aside the demand, the “requesting parties” may petition for mandate to compel the corporation to comply with the demand. At the hearing, the court shall issue the writ unless it appears “that the demand was not made [*16] by an authorized number,” the demand has been complied with, or a protective order is in effect. “No inquiry may be made in such proceeding into the use for which the authorized number seek the list.” (§ 8331, subd. (i).) By the express terms of section 8331, subdivision (i), these procedures apply only when the demand is made by the “authorized number” of members.
In short, when the demand is made by a single member, the burden is on that member to bring court action to enforce the right—although once the action is brought, the corporation has the burden of proving the member’s purpose is improper. But when the demand is made by the authorized number of members, the corporation bears the burden of bringing court action, and must comply with the demand if it does not.
The two different procedures are intentional. The comments based on the legislative committee summary to section 6330, which deals with public benefit nonprofit corporations and which contains language virtually identical to section 8330, explain that prior law allowed a single member to gain access to the membership list, but “a member had to bring suit to enforce this right if the corporation refused to provide the list.” The new law adopts this law “as to the rights of a single member [*17] … .” (Coms. Based on Legis. Com. Summary, Deering’s Ann. Corp. Code (2009 ed.) foll. § 6330, p. 209.) However, the new law provides that upon demand by the “authorized number,” the corporation must provide the list, and if it fails to do so, the authorized number may enforce the right in a summary action. “The committee felt that the above provisions would draw a proper balance between a member’s need for adequate access to membership lists and the need of a corporation to protect itself from wrongful exploitation of an important asset.” (Ibid.)
(6) Here, Parker sought inspection rights of the membership list as a single member. As such, the HOA was not required to seek court involvement, and when Parker brought suit, the HOA had the right to argue that Parker’s purpose was improper. The court’s reliance on section 8331, subdivision (i), to conclude that the HOA was barred from relying on Parker’s improper purpose, was error. As noted above, that subdivision’s provisions apply only when the inspection demand is made by an authorized number of members, not a single member. When Parker sought writ relief, the HOA timely invoked Parker’s improper purpose, and the court found the purpose to be improper. Inspection of the [*18] membership list should have been denied.
In passing, Parker suggests that courts have eliminated the distinction between requests by a “member” and requests by the “authorized number” of members, due to some language in WorldMark, The Club v. Wyndham Resort Development Corp., supra, 187 Cal.App.4th at page 1037. In that case, the inspection demand was made by a single member acting on behalf of the authorized number, and the corporation filed a petition under section 8331 to set aside the demand. (WorldMark, at pp. 1025–1026.) On appeal, the corporation argued that although the member claimed he was acting on behalf of the authorized number of members, his paperwork did not properly establish that the other members had authorized him to act for them. The court responded that the membership list inspection rights “may be exercised either by a single member or by the authorized number of members. Thus, it was not necessary for [the member] to obtain authorizations from any other members in order to exercise his right of inspection and copying.” (Id. at p. 1037.) This was not a holding that the strict procedures applicable to a corporation refusing a membership list request by an authorized number also apply to a corporation refusing the same request by an individual member. Instead, the court was simply acknowledging the uncontroverted [*19] fact that a member alone may, in fact, request inspection of a membership list. The procedures for a corporation’s challenge to such a request were not at issue.
Parker also argues that the HOA may not raise this error for the first time on appeal. He notes that he relied on section 8331, subdivision (i)’s limitations in his briefing in the trial court in support of his petition, and that the HOA did not argue that this subdivision applied only to demands by the authorized number until after the trial court had relied on it to rule in Parker’s favor. Parker argues that it is too late to raise the issue now, when neither party has produced evidence as to whether Parker himself constituted the “authorized number”—that is, if the HOA was so small that Parker alone had a 5 percent voting share.
(7) “‘The rule is well settled that the theory upon which a case is tried must be adhered to on appeal. A party is not permitted to change his position and adopt a new and different theory on appeal. To permit him to do so would not only be unfair to the trial court, but manifestly unjust to the opposing litigant. [Citation.]’ [Citations.] ‘Application of the doctrine may often be justified on principles of estoppel or waiver.’ [*20] [Citation.]” (Richmond v. Dart Industries, Inc. (1987) 196 Cal.App.3d 869, 874 [242 Cal. Rptr. 184].) Whether “the rule is to be applied is largely a question of an appellate court’s discretion. [Citation.]” (Ibid.) It is generally unfair to allow a party to raise a new theory which contemplates a factual situation not put at issue below. (Ibid.)
Here, we exercise our discretion to allow the HOA to raise on appeal the issue of whether a corporation must seek court relief against a single member’s improper membership list request or forever be barred from challenging the member’s purposes. This is a purely legal issue which raises no new facts. Moreover, public policy interests suggest we intervene to protect the innocent HOA members whose privacy rights are implicated.
On the contrary, it is Parker whose new argument raises factual issues. That is, Parker pursued his request, and his petition, solely on the theory that he was seeking the membership list as a single member. It was only when the HOA suggested that it was not barred from challenging Parker’s purpose that Parker raised the new legal theory that he, in fact, constituted the authorized number of members all by himself. He had not sought the membership list as the authorized number of members, and had not pursued [*21] writ relief on that basis. He cannot for the first time on appeal change his factual theory, and argue that he sought the list as the authorized number, when he never gave the HOA notice that he made his request in anything other than “his capacity as a member.”
DISPOSITION
That part of the court’s judgment requiring disclosure of the HOA’s membership list is reversed. The remainder of the judgment, denying inspection of all other documents due to Parker’s improper purpose, is affirmed. Parker is to pay the HOA’s costs on appeal.
Bigelow, P. J., and Grimes, J., concurred.
* Judge of the Los Angeles Superior Court, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.
1 All undesignated statutory references are to the Corporations Code.
2 Indeed, such a holding would entirely undermine the statutory limitation on inspection rights, as any member with an improper purpose would surely be capable of asserting a proper one.
