Category Archives: Case Law

Cobb v. Ironwood Country Club

(2015) 233 Cal.App.4th 960

[ADR; Bylaws Amendment] An amendment to the Bylaws by the HOA incorporating an arbitration provision does not bind ongoing disputes and accrued claims.

Green, Bryant & French, Matthew T. Poelstra; Boudreau Williams and Jon R. Williams for Defendant and Appellant.
Robert L. Bouchier for California State Club Association as Amicus Curiae on behalf of Defendant and Appellant.
Slovak Baron Empey Murphy & Pinkney, Thomas S. Slovak and mCharles L. Gallagher for Plaintiffs and Respondents.
Arbogast and Bowen and David M. Arbogast for Consumer Attorneys of California as Amicus Curiae on behalf of Plaintiffs and Respondents.

OPINION

RYLAARSDAM, J.

—Ironwood Country Club (Ironwood or the Club) appeals from an order denying its motion to compel arbitration of the declaratory relief action brought by plaintiffs William S. Cobb, Jr., and Elizabeth Richards, who are former members of Ironwood, and Patrick J. Keeley and Helen Riedstra, who are current members. The motion to compel was based on an arbitration provision Ironwood incorporated into its bylawsfour months after plaintiffs’ complaint was filed. Ironwood argues (1) that its new arbitration provision was fully applicable to this previously filed lawsuit because the lawsuit concerned a dispute which was “ongoing” between the parties, and (2) that its right to amend its bylaws meant that any such amendment would be binding on both current and former members.

The trial court disagreed, reasoning that Ironwood’s subsequent amendment of its bylaws was insufficient to demonstrate that any of these plaintiffs agreed to arbitratethis dispute, and that if Ironwood’s basic premise were [963] accepted, it would render the agreement illusory. We agree with both conclusions and affirm the order.

When one party to a contract retains the unilateral right to amend the agreement governing the parties’ relationship, its exercise of that right is constrained by the covenant of good faith and fair dealing which precludes amendments that operate retroactively to impair accrued rights. Plaintiffs certainly did not agree to any such illegal impairment in this case.

And Ironwood’s basic premise, which is that each member’s agreement to the bylaw provision allowing for future amendments to its bylaws means those members are automatically bound by whatever amendments the Club makes in accordance with that provision—even after the members have resigned their membership—would doom the agreement as illusory if it were correct. Fortunately, it is not.

FACTS

Plaintiffs’ complaint, filed in August 2012, alleges that two of the plaintiffs are current members of Ironwood, and two are former members. In 1999, the Club entered into an agreement with each of its 588 members, whereby each member loaned the club $25,500 to fund the Club’s purchase of additional land. The members were given the option of paying the funds in a lump sum or by making payments over a period of 20 years into a “Land Purchase Account.” In connection with the loans, the Club represented that if any member sold his or her membership before the loan was repaid, the Club would be “absolutely obligated to pay the Selling Member the entire amount then standing in the Member’s Land Purchase Account.” Moreover, any new member would be required to pay, in addition to the regular initiation fee, an amount equal to the hypothetical balance in a Land Purchase Account, as well as the “remaining unamortized portion of the Land Purchase Assessment.” (Italics omitted.)

In reliance on the Club’s representations, the members voted to approve the land purchase and enter into the loan agreements. Three of the plaintiffs paid the lump sum, and one plaintiff elected to make monthly payments into a Land Purchase Account. The Club consistently reported these payments in financial disclosures as a liability owed to each member, payable upon “sale of a member’s certificate” to a new member. (Italics omitted.) In April 2012, Ironwood represented that it had repaid the $25,500 land purchase assessment to 10 resigned members whose memberships were subsequently purchased by new members, since 2003.

However, plaintiffs alleged that despite the Club’s initial description of how the funds would be generated to reimburse resigning members, it [964] “inexplicably failed” to require new members to pay the equivalent of the land purchase assessment when they joined.

More significantly, in January 2012, Ironwood announced that “[a]fter substantial due diligence, [it had] concluded that the practice of repaying the Land Assessment to forfeiting members . . . must cease effective immediately.” (Italics omitted.) Thereafter, Ironwood made various conflicting and confusing statements and unilaterally imposed new rules to justify writing off its previously acknowledged liability to the members.

Based on those described facts, plaintiffs alleged that an actual controversy has arisen between themselves and Ironwood, with respect to the Club’s obligation to repay the land purchase assessment to each plaintiff.

When plaintiffs filed their complaint, Ironwood’s bylaws contained no arbitration provision. However, four months later, in December 2012, the Club’s board of directors notified the membership that it was contemplating amendments to the bylaws, including the adoption of a bylaw mandating arbitration of “any claim, grievance, demand, cause of action, or dispute of any kind whatsoever . . . of or by a Member past or present . . . arising out of, in connection with, or in relation to Club Membership, Club property, Club financial obligations of whatever nature, Club equipment, and/or Club and/or Member’s activity, and involving the Club and/or the Club’s officers, directors or agents.” When it did not receive a sufficient number of objections from members in response to these proposed amendments, Ironwood’s board adopted the arbitration provision into its bylaws effective December 28, 2012.

In January 2013, Ironwood filed a motion to compel plaintiffs to arbitrate their claim against it, based on Ironwood’s “recent bylaw amendment.” The Club asserted, without analysis, that because plaintiffs each agreed to abide by its bylaws when they became members, including a provision which allowed those bylaws to be amended, they were automatically deemed to have “accepted and agreed to” the arbitration amendment subsequently adopted. Plaintiffs opposed the motion, arguing (1) Ironwood’s amendment of its bylaws did not comply with either legal requirements for corporate voting or the bylaw’s own requirements, (2) Ironwood’s amendment of its bylaws did not establish their agreement to arbitrate this dispute, (3) the provision was unconscionable, and (4) Ironwood had waived any right to arbitrate by using the court process to litigate plaintiff’s claim.

The trial court denied the motion to compel arbitration, concluding that Ironwood’s motion represented an improper effort to apply its new arbitration bylaw retroactively to a pending case. The court reasoned that Ironwood’s subsequent amendment of its bylaws did not reflect any agreement by these [965] plaintiffs to arbitrate this already pending dispute. And because arbitration is a matter of agreement, no party can be compelled to a dispute he has not agreed to submit. The court also pointed out that “[t]aken to its logical extreme, [Ironwood’s] argument would allow for an ever shifting playing field. Indeed, [Ironwood] could arguably amend and require arbitration years into a lawsuit, or amend to make conduct that was wrongful when an action was filed allowable.”

DISCUSSION

On appeal, Ironwood makes three points. Its primary contention is that by accepting membership in the Club, plaintiffs agreed to be bound by its bylaws—including the provision for future amendments—and thus they “[n]ecessarily [a]greed” to its subsequent bylaw amendment requiring arbitration of disputes. Ironwood also disputes the idea that its application of the arbitration provision to this dispute qualifies as “retroactive,” because in Ironwood’s view, the dispute is “ongoing.” And third, it claims the trial court’s ruling contravenes the public policy which requires that any doubt as to whether an arbitration agreement governs a particular dispute must be resolved in favor of ordering arbitration. None of these points has merit.

1. Ironwood’s Power to Amend

Ironwood asserts that its bylaws constitute a contract between the Club and each of its members. (See King v. Larsen Realty, Inc. (1981) 121 Cal.App.3d 349, 357 [175 Cal.Rptr. 226].) We agree. However, the Club further contends that because the bylaws include a provision allowing it to amend them, the members—even formermembers—are deemed to have agreed to whatever amendments are made in accordance with that provision. We cannot agree with that further contention.

(1) Indeed, the contract Ironwood describes would qualify as illusory, and be unenforceable. “[W]hen a party to a contract retains the unfettered right to terminate or modify the agreement, the contract is deemed to be illusory.” (Asmus v. Pacific Bell (2000) 23 Cal.4th 1, 15 [96 Cal.Rptr.2d 179, 999 P.2d 71].) On the other hand, while “an unqualified right to modify or terminate the contract is not enforceable[,] the fact that one party reserves the implied power to terminate or modify a unilateral contract is not fatal to its enforcement, if the exercise of the power is subject to limitations, such as fairness and reasonable notice.” (Id. at p. 16.)

And under California law, one very significant restriction on what might otherwise be a party’s unfettered power to amend or terminate the agreement governing the parties’ relationship is the implied covenant of good faith and [966] fair dealing. (Digerati Holdings, LLC v. Young Money Entertainment, LLC (2011) 194 Cal.App.4th 873, 885 [123 Cal.Rptr.3d 736].) The covenant operates “`as a supplement to the express contractual covenants, to prevent a contracting party from engaging in conduct which (while not technically transgressing the express covenants) frustrates the other party’s rights to the benefits of the contract.'” (Racine & Laramie, Ltd. v. Department of Parks & Recreation (1992) 11 Cal.App.4th 1026, 1031-1032 [14 Cal.Rptr.2d 335].) “The covenant of good faith finds particular application in situations where one party is invested with a discretionary power affecting the rights of another. Such power must be exercised in good faith.” (Carma Developers (Cal.), Inc. v. Marathon Development California, Inc. (1992) 2 Cal.4th 342, 372 [6 Cal.Rptr.2d 467, 826 P.2d 710].)

(2) With respect to arbitration provisions specifically, this court has already held that the implied covenant of good faith and fair dealing prohibits a party from “mak[ing] unilateral changes to an arbitration agreement that apply retroactively to `accrued or known’ claims because doing so would unreasonably interfere with the [opposing party’s] expectations regarding how the agreement applied to those claims.” (Avery v. Integrated Healthcare Holdings, Inc. (2013) 218 Cal.App.4th 50, 61 [159 Cal.Rptr.3d 444].) In reaching this conclusion, we join other courts. (See Peng v. First Republic Bank (2013) 219 Cal.App.4th 1462, 1474 [162 Cal.Rptr.3d 545] [“The implied covenant also prevents an employer from modifying an arbitration agreement once a claim has accrued or become known to it.”]; Peleg v. Neiman Marcus Group, Inc. (2012) 204 Cal.App.4th 1425, 1465 [140 Cal.Rptr.3d 38] [“A unilateral modification provision that is silent as to whether contract changes apply to claims, accrued or known, is impliedly restricted by the covenant so that changes do not apply to such claims.”].)

(3) Thus, to the extent Ironwood intended to enact an arbitration bylaw that would govern this dispute—a dispute which had not only accrued, but was already being litigated in court by the time the arbitration bylaw became effective—it violated the covenant of good faith and fair dealing implied into the bylaws, and thus exceeded the proper scope of its amendment power. Consequently, there is no basis to infer that plaintiffs agreed in advance to be bound by such an attempt.

2. Retroactivity

Even if it were otherwise theoretically proper for a party to unilaterally impose an arbitration provision that applied to claims which had already accrued, there is an additional problem with Ironwood’s claim that its bylaw amendment reflected an agreement to arbitrate this dispute: i.e., there is nothing in the language of either the bylaws generally, or this specific [967] amendment, that states it is intended to have such a retroactive effect. (Cf. Peleg v. Neiman Marcus Group, Inc., supra, 204 Cal.App.4th at pp. 1432-1433 [in which the disputed provision actually stated it would apply to all unfiled claims, even those that had already accrued].)

The Club addresses this additional problem by denying that application of this arbitration provision to the instant case would qualify as retroactive. In the Club’s view, because plaintiffs have alleged their claim for declaratory relief reflects an “ongoing” dispute concerning the parties’ rights, duties and obligations under the loan agreements, it is distinguishable from the type of dispute that is “based upon some incident which occurred at some finite period of time in the past.” This distinction is specious.

All pending lawsuits—even those which are based on a specific past incident—reflect ongoing disputes. That is the very nature of a lawsuit. Until a lawsuit is resolved by settlement or judgment, or becomes moot, it necessarily reflects an ongoing dispute. Application of the arbitration bylaw to this case would qualify as retroactive because it would affect plaintiffs’ already accrued legal claims, as well as their already accrued rights to seek redress for those claims in court. (See Buttram v. Owens-Corning Fiberglas Corp. (1997) 16 Cal.4th 520, 528-529 [66 Cal.Rptr.2d 438, 941 P.2d 71] [proposition applies retroactively if it affects causes of action that accrued prior to its effective date].)

The Club also points out that even if this court were to construe this declaratory relief action as what it chooses to call a “pre-agreement dispute,” “the law does not otherwise forbid the arbitration of such a dispute.” We might agree with that point, as far as it goes, but the problem for Ironwood is that it doesn’t go very far. Coon v. Nicola (1993) 17 Cal.App.4th 1225 [21 Cal.Rptr.2d 846] (Coon), the case the Club relies on, provides no support for retroactive application of an arbitration provision in the context of this case.

In Coon, the plaintiff was treated by the defendant physician for injuries suffered in a mining accident. Several days later, the plaintiff visited the doctor in his office and signed an arbitration agreement. The agreement provided for arbitration of all claims arising out of “prospective care,” but also included an optional provision governing “`[r]etroactive [e]ffect.'” (Coon, supra, 17 Cal.App.4th at p. 1230.) That provision stated: “`If patient intends this agreement to cover services rendered before the date it is signed (for example, emergency treatment) patient should initial below: Effective as of date of first medical services.'” (Ibid.) The Coon court noted “[i]t is not disputed that respondent signed the agreement and separately initialed the clause expressly agreeing to arbitrate disputes stemming from the care appellant rendered prior to the office visit.” (Ibid., italics added.)

[968] Thus, Coon provides no authority for enforcing a unilaterally imposed retroactive arbitration agreement on a party who has not expressly consented to that retroactive application—which is what Ironwood is attempting to do here. Consequently, it offers no support for Ironwood’s position. Moreover, in the course of rejecting plaintiff’s contention that the retroactive agreement would be unenforceable even though he had expressly agreed to it, the Coon court makes a point that affirmatively harms Ironwood’s effort to enforce its new bylaw here: The court states that “[m]ost significantly, the present case does not limit appellant’s liability in any way but merely provides for a different forum in which to settle disputes.” (Coon, supra, 17 Cal.App.4th at p. 1237, italics added.) On this point as well, the Coon case is distinguishable from ours. The bylaw at issue before us, which Ironwood is attempting to apply retroactively, also purports to limit Ironwood’s liability, in that it additionally mandates a “waive[r of] all claims, rights and demands for punitive and consequential damages.” Coon provides no support for retroactive application of such a provision.

3. Public Policy

(4) Ironwood also relies on the strong public policy favoring arbitration provisions as the basis for asserting that any “`[d]oubts as to whether an arbitration clause applies to a particular dispute are to be resolved in favor of sending the parties to arbitration.'” (Vianna v. Doctors’ Management Co. (1994) 27 Cal.App.4th 1186, 1189 [33 Cal.Rptr.2d 188].) However, that presumption is of no assistance to Ironwood here, because it is also true that “[a]rbitration is consensual in nature” (County of Contra Costa v. Kaiser Foundation Health Plan, Inc. (1996) 47 Cal.App.4th 237, 244 [54 Cal.Rptr.2d 628]) and “`[t]he right to arbitration depends on a contract'” between the parties (id. at p. 245). Thus, “`the policy favoring arbitration cannot displace the necessity for a voluntary agreement to arbitrate.'” (Victoria v. Superior Court (1985) 40 Cal.3d 734, 739 [222 Cal.Rptr. 1, 710 P.2d 833].)

And as we have already pointed out, Ironwood’s unilateral amendment of its bylaws, to add an arbitration requirement that purports to retroactively compel plaintiffs to arbitrate a dispute which is already pending in court, does not create a legally enforceable agreement to arbitrate that dispute. Stated simply, this case does not present any “doubt” as to whether Ironwood’s new arbitration bylaw might apply to this case.

Finally, we note that Ironwood’s fervent commitment to the arbitration of any claims its members might choose to file against it, stands in marked contrast to its apparent unwillingness to commit its own claims to the same system. The arbitration bylaw the Club seeks to enforce here applies only to “any claim, grievance, demand, [etc.,] of or by a Member past or present, [969] [etc.]” (Italics added.) These disputes brought by members are to be arbitrated before a “mutually agreed to retired Superior Court Judge.” By its terms, then, the provision does not extend to any claims brought by the Club itself. And if that omission were not clear enough, the bylaw goes on to specify that “[t]his arbitration provision shall not apply to any dispute arising out of the Club’s decision to impose any disciplinary action upon Members as set forth in these Bylaws.” And while the bylaw also provides for arbitration of “claims by the Club against a Member for the payment of dues, assessments, fees and/or use charges,”those arbitrations are required “to be administered by a judicial arbitration company or service in Riverside County that is selected by the Club.”

(5) Such a one-sided provision, especially when coupled with the purported waiver of any award of “punitive or consequential damages,” could be deemed unconscionable. (Armendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4th 83, 118 [99 Cal.Rptr.2d 745, 6 P.3d 669] [“the doctrine of unconscionability limits the extent to which a stronger party may, through a contract of adhesion, impose the arbitration forum on the weaker party without accepting that forum for itself”].)

DISPOSITION

The order is affirmed. Respondents’ request for judicial notice of documents which were lodged, but not filed, in the trial court is denied. Respondents are to recover their costs on appeal.

O’Leary, P. J., and Bedsworth, J., concurred.

Appellant’s petition for review by the Supreme Court was denied April 15, 2015, S224954.

Palm Springs Villas II HOA v. Parth

(2016) 248 Cal.App.4th 268

[Fiduciary Duty; Business Judgment Rule] The Business Judgment Rule does not automatically shield a HOA director from liability that may result from the director’s failure to exercise reasonable diligence or failure to act within the scope of the director’s authority under the HOA’s governing documents.

Epsten Grinnell & Howell, Anne L. Rauch and Joyce J. Kapsal for Cross-complainant and Appellant.
Kulik Gottesman & Siegel, Leonard Siegel, Thomas M. Ware II and Francesca N. Dioguardi for Cross-defendant and Respondent.

OPINION
AARON, J.AARON, J.

I. INTRODUCTION

The Palm Springs Villas II Homeowners Association, Inc. (Association) appeals from a judgment entered in favor of Erna Parth, in connection with actions she took while simultaneously serving as president of the Association and on its Board of Directors (Board). The court granted Parth’s motion for summary judgment as to the Association’s claim for breach of fiduciary duty on the basis of the business judgment rule and an exculpatory provision contained in the Association’s Declaration of Covenants, Conditions, and Restrictions (CC&Rs). The court had previously sustained Parth’s demurrer to the Association’s claim for breach of governing documents without leave to amend, finding that the Association failed to allege a cognizable breach.

On appeal, the Association argues that the trial court erred in its application of the business judgment rule and that there remain material issues of fact in dispute regarding whether Parth exercised reasonable diligence. We agree that the record discloses triable issues of fact that should not have been resolved on summary judgment. We therefore reverse the judgment in favor of Parth. The Association also contends that it stated a claim for breach of the governing documents and that the court erred in sustaining Parth’s demurrer. We conclude that the document cause of action is, at best, duplicative of the fiduciary breach cause and affirm the ruling sustaining the demurrer as to that cause of action without leave to amend.

II. FACTUAL AND PROCEDURAL BACKGROUND^{[fn. 1]}

A. Background on Palm Springs Villas II and its governance

The Association is the governing body for Palm Springs Villas II, a condominium development, and is organized as a nonprofit corporation under California law. The Board, comprised of five homeowners or their agents, governs the Association. The Association’s governing documents include the CC&Rs and its Bylaws. Each homeowner is an Association member and is required to comply with the terms set forth in these documents. [272]

Certain provisions reserve to the Board the authority to take particular actions. Article VI, Section 3, of the CC&Rs provides that the Board “shall have authority to conduct all business affairs of common interest to all Owners.” Article VI, Section 1, of the Bylaws describes the Board’s powers, including to “contract . . . for maintenance, . . . and services” and to “borrow money and incur indebtedness . . . provided, however, that no property of the association shall be encumbered as security for any such debt except under the vote of the majority of the members entitled to vote. . . .”

Other provisions limit the Board’s power and retain authority for the members. Article VI, Section 1, of the Bylaws explains that “[n]otwithstanding the foregoing, the Board shall not, except with the vote or written assent of a majority of the unit owners . . . [e]nter into a contract with a third person wherein the third person will furnish goods or services for the common area or the association for a term longer than one year. . . .” Article XVI, Section 2, of the CC&Rs, provides that “[n]otwithstanding any other provisions of this Declaration or the Bylaws, the prior written approval of at least two-thirds (2/3) of the . . . Owners . . . shall be required” for actions including “the . . . encumbrance, . . . whether by act or omission, of the Common Area. . . .”

The CC&Rs also contain an exculpatory provision. Article VI, Section 16, provides: “No member of the Board . . . shall be personally liable to any Owner, or to any other party, including the Association, for any damage, loss or prejudice of the Association, the Board, the Manager or any other representative or employee of the Association, or any committee, or any officer of the Association, provided that such person has, upon the basis of such information as may be possessed by him, acted in good faith, and without willful or intentional misconduct.”

During the relevant time, Parth was president of the Association, as well as a Board member.

B. Events leading to breach allegations

Roofing repairs

In 2006, the Board hired AWS Roofing and Waterproofing Consultants (AWS) in connection with roofing repairs, with the intention that AWS would vet the companies submitting bids and perform other tasks related to the repairs. According to Parth, AWS prepared a budget estimate for the repairs, the Board submitted a request to the members for a special assessment to offset these costs, and the members voted against the request. Parth then found and retained a roofing company on her own, without consulting either the Board or AWS. [273]

Parth indicated that she tried to contact the roofing company that had previously worked on the roofs, but it was no longer in business, and that she could not find another roofer due to the Association’s financial condition. She obtained the telephone number for a company called Warren Roofing from a contractor that was working on a unit. The record reflects that the person Parth contacted was Gene Layton. At his deposition, Layton stated that he held a contractor’s license for a company called Bonded Roofing and that he had a relationship with Warren Roofing, which held a roofing license. When asked about that relationship, Layton explained that on a large project, he would be the project manager.

At Parth’s deposition, Association counsel asked Parth if she had investigated whether Warren Roofing had a valid license. She replied, “[h]e does and did and bonded and insured.” Counsel clarified “[t]here’s a Bonded Roofing and Warren Roofing. Who did you hire?” Parth responded “One Roofing. That’s all one company, I think.” Counsel then asked if she had “investigate[d] whether Bonded Roofing was licensed,” and Parth answered, “I did not investigate anything.”

According to a June 2007 Board resolution, the Board hired Bonded Roofing to work on a time and materials basis. Layton said that he never met with the Board in a formal meeting or submitted a bid for the work before he started work on the roof. The Association had no records of a written contract with Bonded Roofing or any other roofer.

Warren Roofing submitted invoices and was ultimately paid more than $1.19 million for the work. Many of the checks were signed by Parth. Layton stated that “Bonded Roofing had nothing to do with the money on this job” and that he was paid by Warren Roofing. Board member Tom Thomas indicated that no invoices from Warren Roofing were included in the packets provided to the Board members each month, and Board member Robert Michael likewise did not recall having seen the invoices. Parth explained that she relied on Board member and treasurer Robert ApRoberts, a retired certified public accountant, to review invoices. Larry Gliko, the Association’s contracting expert, opined that the invoices submitted by Warren Roofing were “not at all characteristic” of those typically used in the building industry or submitted to homeowners’ associations, included amounts that Gliko viewed as unnecessary, and charged the Association “almost double” what the work should have cost. Gliko also opined that “the work performed by Warren Roofing [was] deficient,” “fell far below the standard of care,” and “require[d] significant repairs.” [274]

Repaving projects and loans

In April 2007, the Board voted to hire a construction company to repair the walkways. The Board asked the membership to vote on a special assessment to fund this and other repairs. The membership voted to approve the special assessment.

In July 2007, Parth signed promissory notes for $900,000 and $325,000, secured by the Association’s assets and property. She stated that at the time the special assessment was approved, the Board was investigating the possibility of obtaining a loan to raise the capital needed to immediately commence work on the walkway project. Thomas indicated that, as an Association member, he was never asked to approve the debt and did not learn about it until this litigation commenced. The Association had no records indicating that the members were ever informed about, or voted on, the debt.

In April 2010, the Board approved a bid from a paving company to perform repaving work. According to Parth, the Board elected to finance this repaving project with a bank loan, the Board reviewed the loan at the April 2010 meeting, and “unanimously approved” that Parth and/or ApRoberts would sign the loan documents. Parth further stated that at a special Board meeting in May 2010, attended by her, ApRoberts, and Board member Elvira Kitt-Kellam, the Board “resolved that the Association had the power to borrow and pledge collateral” and authorized her and ApRoberts to execute loan documents. Thomas stated that he never received notice of this meeting. In May 2010, Parth and ApRoberts signed a promissory note for $550,000, secured by the Association’s accounts receivable and assets. Thomas indicated that he was never asked to vote on this debt and, again, there were no Association records indicating that the members were notified about or voted on it.

In construction and business loan agreements in connection with the 2007 and 2010 notes, Parth and ApRoberts represented that the agreements were “duly authorized by all necessary action by [the Association]” and did not conflict with the Association’s organizational documents or bylaws. Parth testified at her deposition that she had not reviewed the CC&Rs or Bylaws regarding her authority to execute a promissory note and did not know whether she had such authority under the CC&Rs. In her declaration in support of summary judgment, Parth explained that she believed she “had authority to borrow money and execute loan documents on behalf of the Association in [her] capacity as president,” and was “unaware that a vote of the majority of the members was required in order to pledge the Association’s assets as security for the loan.” She also indicated that “no one advised [her] that she did not have authority to sign the loan documents . . . or that a vote of the membership was required.” [275]

Jesse’s Landscaping

At a December 2010 Board executive meeting attended by Parth, Michael, and Kitt-Kellam, those Board members approved and signed a five-year contract with Jesse’s Landscaping. Thomas indicated that he was not given notice of the meeting. At her deposition, in response to a question regarding whether she had the authority to sign a five-year contract, Parth answered, “I don’t know.” During the same line of questioning, Parth also acknowledged that her “understanding of what [her] authority is under the bylaws” was “[n]one.”

Termination of Personalized Property Management

During the relevant time period, the Association’s management company was Personalized Property Management (PPM). According to Parth, PPM’s owner advised her in or around June or July 2011 that PPM no longer wanted to provide management services for the Association. At a July 9, 2011 Board meeting regarding termination of PPM, the Board tabled any decision to terminate PPM until bids from other companies were obtained and reviewed. Parth proceeded to hire the Lyttleton Company to serve as the Association’s new management company. Thomas stated that he never received written notice of a Board meeting to vote on the hiring of Lyttleton. Parth noticed an executive meeting for July 16, 2011, to discuss termination of PPM and retention of a new company, at which time the Board voted three to two to terminate PPM. Thomas stated that he objected to the vote at the time, based on the Board’s prior decision to table the matter.

Desert Protection Security Services contract

Gary Drawert, doing business as Desert Protection Security Services (Desert Protection), had provided security services for Palm Springs Villas II since 2004. The Association executed a written contract with Desert Protection in December 2003 for one year of security services. Thomas stated that after joining the Board, he learned that Desert Protection and other vendors were providing services pursuant to “oral or month-to-month agreements.” In July 2010, the Board authorized Thomas to obtain bids from security companies to provide security services for 2011.

In January 2011, Parth signed a one-year contract with Desert Protection. Her understanding was that “any contract that was not renewed in writing would . . . be automatically renewed until terminated” and that she was [276] “merely updating the contract, as instructed by management.”^{[fn. 2]} She believed that she had the “authority to sign the contract as the Association’s president.” She further explained that, at the time, the Board had not voted to terminate Desert Protection and discussions regarding a new security company had been tabled.

There were no records indicating that Parth submitted the 2011 Desert Protection agreement to the Board for review or that the Board authorized her to execute it. According to Thomas, Parth did not inform the other Board members that she had signed the agreement. Michael likewise indicated that he had not attended any Board meeting at which the agreement was discussed, and he did not recall the Board having voted on it. Kitt-Kellam stated that the Board never authorized the contract.

In February 2011, the Association’s manager sent Parth and others an e-mail recommending that the Board update certain contracts, including the contract with Desert Protection. Thomas presented the security company bids at a March 2011 Board meeting. The Board tabled the discussion at this meeting and at the subsequent April 2011 meeting. At the July 2011 meeting, the Board approved a proposal from Securitas in a three-to-one vote, with Parth abstaining. According to Thomas, Parth did not disclose at any of these meetings that she had signed a one-year contract with Desert Protection in January 2011. Following the July 2011 Board meeting, Desert Protection was sent a 30-day termination letter, based on the Board’s understanding that the company was operating on a month-to-month basis.

In August 2011, Gary Drawert, the principal of Desert Protection, left a voice mail message for Thomas regarding the Desert Protection agreement. Thomas indicated that prior to this voice mail, he was not aware of the agreement. At the September 2011 Board meeting, Parth produced the Desert Protection agreement. The Board did not ratify it.

C. Desert Protection sues and the Association files a cross-complaint

Drawert sued the Association for breach of contract. The Association cross-complained against Desert Protection and Parth. Following an initial demurrer, the Association filed the operative First Amended Cross-Complaint. The Association settled with Drawert.

With respect to Parth, the Association asserted causes of action for breach of fiduciary duty and breach of governing documents. The cause of action for [277] breach of fiduciary duty alleged that Parth had breached her duties to comply with the governing documents and to avoid causing harm to the Association by, among other things, refusing to submit bids or contracts to the Board, “unilaterally terminating” PPM, and signing the contract with Desert Protection. The breach of governing documents cause of action identified CC&R and Bylaw provisions and identified actions taken by Parth in breach of these provisions, including the termination of PPM and entering into the Desert Protection contract.

Parth demurred to the First Amended Cross-Complaint. With respect to the governing documents claim, she contended that the claim failed to state a cause of action and was uncertain. The court sustained the demurrer without leave to amend as to this cause of action. We discuss this ruling in more detail, post.

Parth moved for summary judgment, contending that the claim of breach of fiduciary duty was barred by the business judgment rule and by the exculpatory provision in the CC&Rs. The trial court granted the motion. In doing so, the court described the business judgment rule (including the requirement that directors “act[] on an informed basis”) and observed that courts will not hold directors liable for errors in judgment, as long as the directors were: “(1) disinterested and independent; (2) acting in good faith; and (3) reasonably diligent in informing themselves of the facts.” The court further noted that the plaintiff has the burden of demonstrating, among other things, that “the decision . . . was made in bad faith (e.g., fraudulently) or without the requisite degree of care and diligence.”^{[fn. 3]}

The court found that Parth had set forth sufficient evidence that she was “disinterested,” and that she had “acted in good faith and without willful or intentional misconduct,” and “upon the basis of such information as she possessed.” The burden shifted to the Association to establish a triable issue of material fact and the court found that the Association failed to satisfy this burden. As to bad faith, the court found that there was a triable issue as to whether Parth had violated the governing documents, but that such a violation would be insufficient to overcome the business judgment rule or the exculpatory provision of the CC&Rs. With respect to diligence, the court found no [278] evidence that Parth “did not use reasonable diligence in ascertaining the facts.” According to the court, the “gravamen of the [Association’s] claims is . . . that Parth repeatedly acted outside the scope of her authority,” and that “[t]he problem with this argument is that Parth believed in her authority to act and the need to act, and the [Association] [fails to] offer any evidence to the contrary, except to say that Parth’s actions violated the . . . CC&Rs.”

The trial court also ruled on the Association’s evidentiary objections; the parties do not indicate whether the court ruled on Parth’s objections. The court entered judgment for Parth and the Association timely appealed.

III. DISCUSSION

A. Motion for summary judgment

The Association claims that the trial court erred in granting Parth’s motion for summary judgment.

Governing law

A defendant moving for summary judgment “bears the burden of persuasion that there is no triable issue of material fact and that [the defendant] is entitled to judgment as a matter of law.” (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850 (Aguilar).) To meet this burden, the defendant must show that one or more elements of the cause of action cannot be established, or that there is a complete defense to that cause of action. (Ibid.) Once the defendant satisfies its burden, “`the burden shifts to the plaintiff . . . to show that a triable issue of one or more material facts exists as to that cause of action or a defense thereto.’” (Id. at p. 849.) “Because a summary judgment denies the adversary party a trial, it should be granted with caution.” (Colores v. Board of Trustees (2003) 105 Cal.App.4th 1293, 1305.)

We review a trial court’s grant of summary judgment de novo. (Buss v. Superior Court (1997) 16 Cal.4th 35, 60.) “[W]e must assume the role of the trial court and redetermine the merits of the motion. In doing so, we must strictly scrutinize the moving party’s papers. [Citation.] The declarations of the party opposing summary judgment, however, are liberally construed to determine the existence of triable issues of fact. All doubts as to whether any material, triable issues of fact [279] exist are to be resolved in favor of the party opposing summary judgment.” (Barber v. Marina Sailing, Inc. (1995) 36 Cal.App.4th 558, 562.)^{[fn, 4]}

Application

a. Principles governing decisionmaking by a director

“The common law `business judgment rule’ refers to a judicial policy of deference to the business judgment of corporate directors in the exercise of their broad discretion in making corporate decisions. . . . Under this rule, a director is not liable for a mistake in business judgment which is made in good faith and in what he or she believes to be the best interests of the corporation, where no conflict of interest exists.” (Gaillard v. Natomas Co. (1989) 208 Cal.App.3d 1250, 1263 (Gaillard); see Ritter & Ritter, Inc. Pension & Profit Plan v. The Churchill Condominium Assn. (2008) 166 Cal.App.4th 103, 123 (Ritter) [business judgment rule “sets up a presumption that directors’ decisions are based on sound business judgment”].)

In California, there is a statutory business judgment rule. Corporations Code section 7231 applies to nonprofit corporations and provides that “[a] director shall perform the duties of a director, . . ., in good faith, in a manner such director believes to be in the best interests of the corporation and with such care, including reasonable inquiry, as an ordinarily prudent person in a like position would use under similar circumstances.” (§ 7231, subd. (a); see Ritter, supra, 166 Cal.App.4th at p. 123.) The statute goes on to state that “[a] person who performs the duties of a director in accordance [with the preceding subdivisions] . . . shall have no liability based upon any alleged failure to discharge the person’s obligations as a director. . . .” (§ 7231, subd. (c); see Ritter, at p. 123; see also § 7231.5, subd. (a) [limiting liability on the same grounds for volunteer directors and officers].)^{[fn. 5]}

“Notwithstanding the deference to a director’s business judgment, the rule does not immunize a director from liability in the case of his or her abdication of corporate responsibilities.” (Gaillard, supra, 208 [280] Cal.App.3d at p. 1263.) “`The question is frequently asked, how does the operation of the so-called `business judgment rule’ tie in with the concept of negligence? There is no conflict between the two. When courts say that they will not interfere in matters of business judgment, it is presupposed that judgment—reasonable diligence—has in fact been exercised. A director cannot close his eyes to what is going on about him in the conduct of the business of the corporation and have it said that he is exercising business judgment.’” (Burt v. Irvine Co. (1965) 237 Cal.App.2d 828, 852-853 (Burt);Gaillard, supra, at pp. 1263-1264 [accord].)

Put differently, whether a director exercised reasonable diligence is one of the “factual prerequisites” to application of the business judgment rule. (Affan v. Portofino Cove Homeowners Assn. (2010) 189 Cal.App.4th 930, 941 (Affan); id. at p. 943 [finding a homeowners association “failed to establish the factual prerequisites for applying the rule of judicial deference” at trial, where “there was no evidence the board engaged in `reasonable investigation’ (citation) before choosing to continue its `piecemeal’ approach to sewage backups”]; see §§ 7231, subd. (a), 7231.5, subd. (a); see also Lamden v. La Jolla Shores Clubdominium Homeowners Assn. (1999) 21 Cal.4th 249, 253 (Lamden) [requiring “reasonable investigation” for judicial deference]; Everest Investors 8 v. McNeil Partners (2003) 114 Cal.App.4th 411, 432 (Everest) [accord].)

b. The business judgment rule on summary judgment

The business judgment rule “raises various issues of fact,” including whether “a director acted as an ordinarily prudent person under similar circumstances” and “made a reasonable inquiry as indicated by the circumstances.” (Gaillard, supra, 208 Cal.App.3d at p. 1267.) “Such questions generally should be left to a trier of fact,” but can become questions of law “where the evidence establishes there is no controverted material fact.” (Id. at pp. 1267-1268.) “The function of the trial court in ruling on [a] motion[] for summary judgment [is] merely to determine whether such issues of fact exist, and not to decide the merits of the issues themselves. [Citation.] Our function is the same as that of the trial court.” (Id. at p. 1268; see id. at p. 1271 [identifying a triable issue of fact as to whether it was reasonable for the directors on the compensation committee to rely on outside counsel “with no further inquiry,” and observing that “[a] trier of fact could reasonably find that the circumstances warranted a thorough review of the golden parachute agreements”]; id. at pp. 1271-1272 [noting a “triable issue of fact as to whether some further inquiry” was warranted by the other directors regarding [281] the golden parachutes, under the circumstances, notwithstanding that they were entitled to rely on the recommendation of the compensation committee].)^{[fn. 6]}(Cf. Harvey v. The Landing Homeowners Assn. (2008) 162 Cal.App.4th 809, 822 [affirming summary judgment in dispute over attic space use where undisputed evidence showed the board, upon “reasonable investigation” and in good faith “properly exercised its discretion within the scope of the CC&R’s. . . .”].)

c. The trial court erred in granting summary judgment

The Association raises two challenges to the summary judgment ruling: that the trial court erred by applying the business judgment rule to Parth’s ultra vires acts (or conduct otherwise outside Parth’s authority) and that there are triable issues of material fact as to whether Parth exercised reasonable diligence.

i. Ultra vires conduct

The Association has not established that Parth’s conduct was ultra vires. Ultra vires conduct is conduct that is beyond the power of the corporation, not an individual director. (See McDermott v. Bear Film Co. (1963) 219 Cal.App.2d 607, 610-611 [“In its true sense the phrase ultra vires describes action which is beyond the purpose or power of the corporation.”]; Sammis v. Stafford (1996) 48 Cal.App.4th 1935, 1942 [“If, however, the director’s act was within the corporate powers, but was performed without authority or in an unauthorized manner, the act is not ultra vires.”].) The Association does not distinguish these authorities, nor does it identify conduct by Parth that went beyond the power of the Association.

However, the Association does cite cases suggesting that noncompliance with governing documents may fall outside the scope of the business judgment rule, at least in certain circumstances. (See Nahrstedt v. Lakeside Village Condominium Assn. (1994) 8 Cal.4th 361, 374 [282] (Nahrstedt) [finding “courts will uphold decisions made by the governing board of an owners association,” where among other things, they “are consistent with the development’s governing documents”]; Lamden, supra,21 Cal.4th at p. 253 [requiring that association board “exercise[] discretion within the scope of its authority under relevant statutes, covenants and restrictions” in order to merit judicial deference]; Dolan-King v. Rancho Santa Fe Assn. (2000) 81 Cal.App.4th 965, 979 [accord]; Scheenstra v. California Dairies, Inc. (2013) 213 Cal.App.4th 370, 388 [finding a “board’s decision is not scrutinized under the business judgment rule . . . until after the court determines that the action . . . falls with the discretionary range of action authorized by the contract”].) See also Ekstrom v. Marquesa at Monarch Beach Homeowners Assn. (2008) 168 Cal.App.4th 1111, 1123 (“Even if the Board was acting in good faith . . ., its policy . . . was not in accord with the CC&Rs. . . . The Board’s interpretation of the CC&Rs was inconsistent with the plain meaning of the document and thus not entitled to judicial deference.”).

Parth contends that the business judgment rule protects a director who violates governing documents, as long as the director believes that the actions are in the best interests of the corporation. She relies on Biren v. Equality Emergency Medical Group, Inc. (2002) 102 Cal.App.4th 125 (Biren). Biren, which involved a dispute between a company and a former director, held that the “business judgment rule may protect a director who acts in a mistaken but good faith belief on behalf of the corporation without obtaining the requisite shareholder approval.” The Biren court determined that the director in question was protected by the rule, even though she violated the shareholder agreement. (Id. at pp. 131-132.) However, the court did not suggest that such conduct would always be protected. Rather, the court concluded that the violation “did not by itself make the business judgment rule inapplicable,” explaining that the company failed to prove that the director had “intentionally usurped her authority” or that “her actions were anything more than an honest mistake.” (Id. at p. 137.) The court also noted the trial court’s “finding that [the director] `reasonably relied’ on information she believed to be correct,” observing that this was “tantamount to a finding she acted in good faith.” (Id. at p. 136.) In other words, Biren held that the director’s violation of the governing documents did not render the business judgment rule inapplicable under the circumstances; namely, where the remainder of the business judgment rule requirements were satisfied.

Here, the trial court agreed that there was a triable issue of material fact as to whether Parth breached the governing documents, but concluded that even if she had, this was insufficient to overcome the protection of the business judgment rule. However, the case law is clear that conduct contrary to [283] governing documents may fall outside the business judgment rule. (See, e.g., Nahrstedt, supra, 8 Cal.4th at p. 374.) Even if Biren establishes an exception to this principle where the director has satisfied the remaining elements of the business judgment rule, in this case, triable issues of material fact exist as to other elements of the rule and renderBireninapplicable, at least at this stage. The trial court erred in assuming that the business judgment rule would apply to Parth’s actions that violated the governing documents.

ii. Material issues of fact

Although the trial court properly recognized that a director must act on an informed basis, be reasonably diligent, and exercise care in order to rely on the business judgment rule, the court erred in concluding that the Association failed to demonstrate triable issues of fact with respect to these matters. (See Gaillard, supra, 208 Cal.App.3d at pp. 1271-1272, 1274 [reversing summary judgment due to material issues of fact as to whether further inquiry was warranted].) We conclude that material issues of fact exist as to whether Parth exercised reasonable diligence in connection with the actions at issue.

First, with respect to the roofing repairs, Parth explained how she found Warren Roofing and testified at her deposition that Warren Roofing was licensed. However, during the same line of questioning, she displayed ignorance of the relationship between Warren Roofing and Bonded Roofing and admitted that she had not “investigate[d] anything” pertaining to whether Bonded Roofing was licensed. The Association also established that Parth retained a roofing contractor without any formal bid or contract, that the Board retained Bonded Roofing but paid Warren Roofing, that Warren Roofing may have significantly overcharged the Association for the work performed, and that this work was defective and required repair.^[7] This evidence is sufficient to raise an issue as to Parth’s diligence in investigating, retaining, and paying the roofers. (See Affan, supra, 189 Cal.App.4th at pp. 941, 943 [business judgment rule did not apply where, among other things, there was no evidence of a reasonable investigation into sewage work].)^{[fn. 8]} Parth’s reliance on ApRoberts to review invoices does not resolve these issues. (See Gaillard, supra,208 Cal.App.3d at p. 1271 [although the directors could rely upon the recommendations of outside counsel and the [284] compensation committee, triable issues existed as to whether further inquiry was still required under the circumstances].)

Second, the 2007 and 2010 promissory notes, secured by Association assets, similarly raise issues as to whether Parth proceeded on an informed basis. She relies on her belief that she had the authority to take out the loans, her lack of awareness that a member vote was required to encumber the assets of the Association, and that no one advised her that she lacked the authority or that membership approval was required. She also states in her declaration that she and two other Board members authorized her and ApRoberts to sign the 2010 note. However, as the Association points out, the governing documents require member approval for such debt and there is no record of such approval. Parth’s deposition testimony also reflects that she did not know whether she had the authority under the governing documents to sign the loans, and that she made no effort to determine whether she had such authority. Whether Parth exercised sufficient diligence to inform herself of the Association’s requirements pertaining to the loans at issue is a question for the trier of fact. (See Gaillard, supra, 208 Cal.App.3d at p. 1267; id. at p. 1271 [noting triable issue as to whether the “circumstances warranted a thorough review of the . . . agreements”].) Parth “cannot close [her] eyes” to matters as basic as the provisions of the CC&Rs and Bylaws of the Association and at the same time claim that she “exercis[ed] business judgment.” (Id. at p. 1263.)

Third, as to Jesse’s Landscaping, Parth indicated that three Board members, including herself, approved a five-year contract in 2010. However, the Association provided evidence that the governing documents require that a contract with a third party exceeding one year be approved by member vote. In addition, Parth acknowledged at her deposition that she did not know whether she had the authority to sign a five-year contract, and that she had no understanding of what her authority was under the Bylaws. This evidence suggests that Parth may not have understood, nor made any effort to understand, whether the Board was permitted to authorize the Jesse’s Landscaping contract without member approval. As with the loans, Parth’s admitted lack of effort to inform herself of the extent of her authority in this regard is sufficient to establish a triable issue. (See Gaillard, supra, 208 Cal.App.3d at pp. 1263, 1267, 1271.)

Fourth, regarding the PPM termination, Parth explained that PPM’s owner did not want PPM to be the management company for the Association any [285] longer and that the Board subsequently voted to terminate PPM on July 16, 2011. However, the Association’s evidence reflects that the Board had tabled the issue of the termination of PPM on July 9 and that Parth met with and hired Lyttleton Company, apparently without calling a Board meeting to vote on the matter. The timeline of these events is somewhat unclear, including whether Parth hired Lyttleton before the Board voted to terminate PPM, but we will not attempt to resolve such factual issues on summary judgment. Regardless of the timing, the evidence presented as to the matter raises questions as to whether Parth proceeded with reasonable diligence. (See Gaillard, supra, 208 Cal.App.3d at pp. 1271-1272; Affan, supra, 189 Cal.App.4th at pp. 941, 943.)

Finally, the Desert Security contract similarly calls into question Parth’s diligence. Parth offered several explanations for her execution of the contract with Desert Security in January 2011, despite the Board’s decision to consider bids from other companies for security services. Some of her explanations were inconsistent,^[fn.9]and the Association’s evidence cast doubt on all of them. With respect to Parth’s stated belief that she had the authority to sign the contract, the Association provided evidence in other contexts (e.g., the promissory notes) that Parth failed to understand the scope of her authority; this same evidence suggests that she made no effort to ascertain what authority she did possess to conduct the business of the Association. The business judgment rule would not extend to such willful ignorance. (See Gaillard, supra, 208 Cal.App.3d at p. 1263.) Parth also indicated that at the time she signed the contract, the Board had tabled the security discussion and had not yet terminated Desert Protection. However, the Association provided evidence that Parth failed to bring the new contract to the attention of the Board or alert the Board to its existence, even after the security discussion had been reopened, thus calling into question Parth’s explanations. This conduct raises serious questions as to Parth’s diligence, particularly given the timing of the relevant events. (Id. at p. 1271 [noting the “nature” and “timing” of the agreements at issue].)

Although the trial court declined to address much of the Association’s evidence, it did discuss the Desert Protection situation. The court stated that the Association disputed the basis for Parth’s belief in her authority to sign the Desert Protection contract by citing the Bylaws, and concluded that this evidence did not controvert Parth’s professed belief. While the Bylaws may [286] not undermine Parth’s belief, together with the Association’s other evidence, they do demonstrate the existence of a triable issue of material fact as to whether Parth’s proceeding on such belief—without keeping the Board informed—showed reasonable diligence under the circumstances.

In sum, the Association produced evidence establishing the existence of triable issues of material fact as to whether Parth acted on an informed basis and with reasonable diligence, precluding summary judgment based on the business judgment rule. The trial court’s erroneous conclusion that “there [was] no evidence that Parth did not use reasonable diligence” reflects a misapplication of the business judgment rule, summary judgment standards, or both. To the extent that the court viewed the Association’s evidence regarding Parth’s diligence as irrelevant, in light of her “belief[] in [her] authority to act and the need to act,” the court failed to apply the reasonable diligence requirement in any meaningful way. Permitting directors to remain ignorant and to rely on their uninformed beliefs to obtain summary judgment would gut the reasonable diligence element of the rule and, quite possibly, incentivize directors to remain ignorant. To the extent that the trial court did consider the Association’s evidence, but found it insufficient to establish a lack of diligence, the court improperly stepped into the role of fact finder and decided the merits of the issue.

In addition, the Association contends that courts treat diligence and good faith as intertwined, citing Biren’s description of the trial court’s finding that the director reasonably relied on information she believed to be correct as “tantamount” to a finding of good faith. (See Biren, supra, 102 Cal.App.4th at p. 136.) Our own research reveals that other courts similarly have considered diligence as part of the good faith inquiry. (See, e.g., Affan, supra, 189 Cal.App.4th at p. 943 [“Nor was there evidence the Association acted `in good faith . . ., because no one testified about the board’sdecisionmaking process. . . . [¶] [I]n Lamden, ample evidence demonstrated the association board engaged in the sort of reasoned decisionmaking that merits judicial deference. There is no such showing in the case before us.”]; see also Desaigoudar v. Meyercord (2003) 108 Cal.App.4th 173, 189 [“[T]he court must look into the procedures employed and determine whether they were adequate or whether they were so inadequate as to suggest fraud or bad faith. That is, `[p]roof . . . that the investigation has been so restricted in scope, so shallow in execution, or otherwise so pro forma or halfhearted as to constitute a pretext or sham, consistent with the principles underlying the application of the business judgment doctrine, would raise questions of good faith or conceivably fraud which would never be shielded by that doctrine.’”].) In light of these [287] authorities, we recognize that there may be a triable issue of material fact as to Parth’s good faith, as well.^{[fn. 10]}

iii. Parth’s contentions

As a preliminary matter, Parth contends that “[v]irtually all of the evidence proffered in opposition to the motion for summary judgment was inadmissible,” but cites only her own evidentiary objections, rather than any ruling by the trial court. She also does not offer any argument regarding the evidence itself, other than to state generally that evidence without foundation is inadmissible (and, with one exception not relevant here, does not identify any specific evidence). We conclude that Parth has forfeited these objections. (Stanley, supra, 10 Cal.4th at p. 793; Del Real v. City of Riverside(2002) 95 Cal.App.4th 761, 768 [“[I]t is counsel’s duty to point out portions of the record that support the position taken on appeal. . . .”]; ibid. [“[A]ny point raised that lacks citation may, in this court’s discretion, be deemed waived.”].)

Turning to Parth’s substantive arguments, we first address her contention that she displayed no bad faith. She relies on cases characterizing bad faith as intentional misconduct, encompassing fraud, conflicts of interest, and intent to serve an outside purpose. (See, e.g., Barnes v. State Farm Mut. Auto. Ins. Co. (1993) 16 Cal.App.4th 365, 379.) However, the Association’s appeal focuses on Parth’s failure to exercise reasonable diligence, so establishing an absence of evidence of intentional misconduct unrelated to diligence does not undermine the Association’s arguments.

Next, Parth suggests that the Association’s concerns with respect to her lack of diligence in securing a roofing contractor sound in negligence, contending that “a director’s conduct or decisions are not judged according to a negligence standard.” (Boldface omitted.) However, as the authorities [288] discussed ante make clear, there is “no conflict” between the business judgment rule and negligence, and application of that rule “presuppose[s] that . . . reasonable diligence [] has in fact been exercised.” (Gaillard, supra, 208 Cal.App.3d at pp. 1263-1264, quoting Burt, supra, 237 Cal.App.2d at pp. 852-853; Affan, supra, 189 Cal.App.4th at p. 941.)

Parth’s reliance on the exculpatory clause of the Association’s CC&Rs is similarly unpersuasive. She contends that even if she exceeded her authority, the “only condition for the stated contractual immunity is that the board members perform their duties in `good faith, and without willful or intentional misconduct.’” However, she fails to address the immediately preceding clause, which requires that the director act “upon the basis of such information as may be possessed by [her].” This language is arguably analogous to the business judgment rule’s reasonable diligence requirement. (Gaillard, supra, 208 Cal.App.3d at pp. 1263-1264.) At minimum, even if the exculpatory provision did not obligate Parth to obtain additional information regarding particular undertakings, it surely contemplated that she would familiarize herself with information already in her possession—such as the governing documents of the Association. Further, both the business judgment rule and the exculpatory clause of the CC&Rs require good faith and, as discussed ante, an absence of diligence may reflect a lack of good faith. Given this overlap, we conclude that at least some of the triable issues of material fact that bar summary judgment with respect to the business judgment rule similarly preclude it as to the exculpatory clause.^{[fn. 11]}

Finally, we address Parth’s contention that the Association’s claim is time barred to the extent that it concerns events that occurred prior to May 22, 2008. Parth contends that there is a four-year statute of limitations for a breach of fiduciary duty claim and that admissible evidence is required to support the claim, but does not explain how these principles would permit her to obtain summary judgment as to a portion of a cause of action. We agree with the Association both that Parth’s attempt to apply the statute of limitations to obtain judgment on a part of its breach of fiduciary duty claim is improper and that the existence of material questions of fact preclude resolution of statute of limitations issues at this juncture. (See McCaskey v. California State Automobile Assn. (2010) 189 Cal.App.4th 947, 975 [“there can be no summary adjudication of less than an entire cause of action. . . . If a cause of action is not shown to be barred in its entirety, no order for summary judgment—or adjudication—can be entered.” [289]]; Jolly v. Eli Lilly & Co. (1988) 44 Cal.3d 1103, 1112[“resolution of the statute of limitations issue is normally a question of fact”].)

B. Demurrer

The Association contends that the trial court erroneously granted Parth’s demurrer to its cause of action for breach of governing documents, without leave to amend.

Governing law

We review a ruling sustaining a demurrer de novo, exercising independent judgment as to whether the complaint states a cause of action as a matter of law. (Desai v. Farmers Ins. Exchange (1996) 47 Cal.App.4th 1110, 1115.) “We affirm the judgment if it is correct on any ground stated in the demurrer, regardless of the trial court’s stated reasons.” (Fremont Indemnity Co. v. Fremont General Corp. (2007) 148 Cal.App.4th 97, 111.) Further, “`[i]f another proper ground for sustaining the demurrer exists, this court will still affirm the demurrer[ ]. . . .’” (Jocer Enterprises, Inc. v. Price(2010) 183 Cal.App.4th 559, 566.)

When a demurrer is sustained without leave to amend, “we decide whether there is a reasonable possibility that the defect can be cured by amendment: if it can be, the trial court has abused its discretion and we reverse; if not, there has been no abuse of discretion and we affirm. [Citations.] The burden of proving such reasonable possibility is squarely on the plaintiff.” (Blank v. Kirwan (1985) 39 Cal.3d 311, 318 (Blank).)

Application

With respect to the Association’s cause of action for breach of governing documents, the trial court ruled: “The HOA has not alleged that Parth breached any covenant. The only sections of the governing documents referred to in the cross-complaint are bylaws that deal with the Boards [sic] transaction of the Associations [sic] business affairs 7-11. These sections describe how the Board acts. It . . . does not appear that they are covenants between the HOA and individual members that the HOA may sue to enforce.”

First, the Association does not cite only the Bylaws; it also cites the CC&R provision reserving authority over the Association’s affairs to the Board. In any event, we see no reason why the governing document provisions would be unenforceable as to Parth, an owner and Association member who was [290] serving as president and was a member of the Board. (See Civ. Code, § 5975, subd. (a) [“The covenants and restrictions in the declaration shall be enforceable equitable servitudes . . . and bind all owners” and generally “may be enforced by . . . the association”], subd. (b) [“A governing document other than the declaration may be enforced by the association against an owner”]; see also, e.g., Biren, supra, 102 Cal.App.4th at p. 141 [affirming judgment against director for breach of shareholder agreement];Briano v. Rubio(1996) 46 Cal.App.4th 1167, 1172, 1180 [affirming judgment against directors for violation of articles of incorporation].)

Regardless, as Parth argues, the cause of action for breach of governing documents appears to be duplicative of the cause of action for breach of fiduciary duty. This court has recognized this as a basis for sustaining a demurrer. (See Rodrigues v. Campbell Industries (1978) 87 Cal.App.3d 494, 501 [finding demurrer was properly sustained without leave to amend as to cause of action that contained allegations of other causes and “thus add[ed] nothing to the complaint by way of fact or theory of recovery”]; see also Award Metals, Inc. v. Superior Court (1991) 228 Cal.App.3d 1128, 1135 [Second Appellate District, Division Four; demurrer should have been sustained as to duplicative causes of action].)^{[fn. 12]} The Association does not address Parth’s argument or explain how its document claim differs from the fiduciary breach claim. We conclude that the trial court properly sustained the demurrer.

Second, the burden is on the Association to articulate how it could amend its pleading to render it sufficient. (Blank, supra, 39 Cal.3d at p. 318; Goodman v. Kennedy(1976) 18 Cal.3d 335, 349 [“Plaintiff must show in what manner he can amend his complaint and how that amendment will change the legal effect of his pleading.”].) The Association offers no argument on this point and we therefore conclude that it has forfeited the issue. (Stanley, supra, 10 Cal.4th at p. 793.)

IV. DISPOSITION

The order granting summary judgment and judgment are reversed. The ruling sustaining the demurrer to the breach of governing documents cause of [291] action without leave to amend is affirmed. The parties shall bear their own costs on appeal.

HUFFMAN, Acting P. J. and PRAGER, J.,^{[fn. *]} concurs.

[FN. 1] We rely on the facts that the parties set forth in their separate statements in the trial court and the evidence cited therein, as well as other evidence submitted with the parties’ papers below. (Sandell v. Taylor-Listug, Inc. (2010) 188 Cal.App.4th 297, 303, fn. 1.) However, we do not rely on evidence to which objections were sustained. (Wall Street Network, Ltd. v. New York Times Co. (2008) 164 Cal.App.4th 1171, 1176.)

[FN. 2] Although Parth’s statement that she believed that she had been instructed by management to enter into the contract with Desert Protection is in the record, the trial court sustained an objection to her declaration statement that she was told that the contract “needed to be updated and was ready to be signed.”

[FN. 3] The trial court also stated that the “business judgment rule standard is one of gross negligence—i.e., failure to exercise even slight care,” citing Katz v. Chevron (1994) 22 Cal.App.4th 1352. The court did not explain how this standard relates to the components of the business judgment rule. The parties likewise cite the concept without such analysis. Given that Katz relies on Delaware law for this standard and the issues before us can be resolved according to the standard of reasonable diligence under California law, we will not focus on gross negligence in our analysis. However, the facts that raise a triable issue as to Parth’s diligence, discussed post, would also raise an issue as to whether she exercised “even slight care.”

[FN. 4] Contrary to Parth’s claim, a summary judgment is not “entitled to a presumption of correctness.” The cases on which she relies simply confirm the general principle that an appellant must establish error on appeal. (See, e.g., Denham v. The Superior Court of Los Angeles County (Marsh & Kidder) (1970) 2 Cal.3d 557, 564 [“[E]rror must be affirmatively shown.”]; Reyes v. Kosha (1998) 65 Cal.App.4th 451, 466, fn. 6 [“Although our review of a summary judgment is de novo, it is limited to issues which have been adequately raised and supported in [appellants’] brief.”].)

[FN. 5] All further statutory references are to the Corporations Code unless otherwise indicated.

[FN. 6] (See Everest, supra, 114 Cal.App.4th at p. 430 [finding that triable issues of fact as to the existence of improper motives and a conflict of interest “preclude[d] summary judgment based on the business judgment rule”]; Will v. Engebretson & Co. (1989) 213 Cal.App.3d 1033, 1044 [“Will submitted evidence that . . . the committee members never reviewed the complaint, the financial records of the corporation, or made any investigation into the matter at all. Company, of course, disputes these allegations. But it is precisely because the issues are disputed that it was error for the trial court to resolve the issues. . . .”].)

[FN. 7] There also was no evidence of a written warranty for the roofing work. Layton testified at deposition that he provided a warranty, but did not indicate that it was written, and Parth contends only that she obtained a verbal warranty.

[FN. 8] The Association contends that both Warren Roofing and Bonded Roofing were unlicensed at the time the roofing work was done, while Parth maintains that Warren Roofing was licensed. We need not address this dispute. Although the existence of facts that the exercise of proper diligence might have disclosed (such as license status) may be relevant to whether Parth exhibited reasonable diligence (see Berg & Berg Enterprises, LLC v. Boyle (2009) 178 Cal.App.4th 1020, 1046), we conclude that her admission that she “did not investigate anything,” in the context of a major repair project, is sufficient to raise a triable issue.

[FN. 9] For example, Parth indicated both that she believed nonwritten contracts would be automatically renewed and that she was “merely updating” the contract, without explaining why a new or updated contract would be necessary if the existing contract would automatically be renewed.

[FN. 10] The Association also appears to challenge several other actions on the part of Parth, but fails to support its challenge with argument and/or specific authority. These actions include Parth’s execution of the Board member Code of Conduct, certain purported violations of the Common Interest Open Meeting Act and Davis-Stirling Common Interest Development Act, and various facts pertaining to bad faith. We deem these matters forfeited. (People v. Stanley (1995) 10 Cal.4th 764, 793 (Stanley) [it is not the reviewing court’s role to “construct a theory” for appellant: “[E]very brief should contain a legal argument with citation of authorities on the points made. If none is furnished on a particular point, the court may treat it as waived. . . .”].) In addition, because we conclude that the Association has established the existence of triable issues of material fact as to both the business judgment rule and the exculpatory provision of the CC&Rs, see discussion post, we need not reach its arguments under section 5047.5 and Civil Code section 5800 or its argument that Parth is estopped from claiming ignorance of the governing documents.

[FN. 11] We reject Parth’s claim that the Association waived the exculpatory clause issue. Although the Association did not address the issue until its reply brief, it takes the position on reply that the exculpatory clause is “a recitation of the business judgment rule.” Parth, meanwhile, relied on the same undisputed facts to support both issues. Under the circumstances, we see no reason to preclude the Association from relying on its business judgment rule arguments and evidence for the exculpatory clause issue.

[FN. 12] But see Blickman Turkus, LP v. MF Downtown Sunnyvale, LLC (2008) 162 Cal.App.4th 858, 890(Sixth Appellate District) (finding that duplication is not grounds for demurrer and that a motion to strike is the proper way to address duplicative material).

[FN. *] Judge of the San Diego Superior Court, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.

Heather Farms Homeowners Association v. Robinson

(1994) 21 Cal.App.4th 1568

[Attorney’s Fees; Prevailing Party] The determination as to who is the “prevailing party” entitled to its attorney’s fees under the Davis-Stirling Act is based on the court’s analysis of which party prevailed on a practical level. When that determination is made, the court’s ruling should be affirmed on appeal absent an abuse of discretion.

Smith, Merrill & Peffer, Charles E. Merrill and Karl R. Molineux for Defendant and Appellant.
Abend, Lepper, Jacobson, Schaefer & Hughes and Gary M. Lepper for Plaintiff and Respondent.

OPINION
PETERSON, P. J.

In this case, we hold that a trial court has the authority to determine the identity of the “prevailing party” in litigation, within the meaning of Civil Code ^{fn. 1} section 1354, for purposes of awarding attorney fees; and that a defendant dismissed without prejudice in an action to enforce equitable servitudes thereunder is not, ipso facto, such prevailing party.

I. Factual and Procedural Background

This is a dispute over attorney fees incurred in an action to enforce the covenants, conditions, and restrictions (CC&R’s) which govern a residential planned unit development in Walnut Creek. Appellant in this action, Wayne Robinson, owned two units in the development. In January 1988, Heather Farms Homeowners Association, Inc. (association), the entity charged with enforcing the CC&R’s, sued Robinson alleging he had made unauthorized modifications to his units. As so frequently happens in modern litigation, the complaint spawned a complex series of cross-complaints and subsidiary actions which eventually entangled the association itself, the association’s attorneys, appellant’s corporation, various real estate agents, and the persons who purchased appellant’s units while the litigation was pending.

After several years of litigation, the actions were assigned to a trial judge (the Honorable Peter L. Spinetta) who, recognizing the complexity of the dispute, referred the matter to a second judge (the Honorable James J. Marchiano) for a special settlement conference. After two days of discussion, Judge Marchiano negotiated a settlement which resolved the litigation completely.

Only one aspect of that settlement is relevant to this appeal. While Robinson expressly declined to participate in any agreement with the association, the settlement nonetheless required the association to dismiss its suit against Robinson “without prejudice.” However, Judge Marchiano cautioned [1571] that this should not be interpreted as meaning that Robinson had prevailed: “The Court is making a specific finding that there are no prevailing parties with respect to that issue [the dismissal without prejudice] and that the Court and the law [favor the] resolution of disputes. This dismissal is part of an overall complex piece of litigation … that’s been resolved by a negotiated settlement. There are no winners. There are no favorable parties in this case.”

At the conclusion of the settlement, Robinson filed a memorandum seeking to recover his costs from the association. He claimed that since the object of the association’s suit was to enforce the development’s CC&R’s, the “prevailing party” in the litigation was entitled to recover attorney fees and costs under section 1354. Robinson maintained that since he had received a dismissal, he was the “prevailing party” and the association was obligated to pay his attorney fees of over $479,000, and his litigation costs of approximately $20,000.

The association conceded that section 1354 was applicable, but argued Robinson was not the “prevailing party” within the meaning of that section.

The trial court ruled that Robinson was the prevailing party for purposes of his general litigation expenses (filing fees, deposition costs, jury fees, etc.) and, thus, was entitled to recover those costs from the association, but that Robinson was not entitled to recover his attorney fees under section 1354. As to the latter issue, the court agreed with the settlement judge and concluded there was no “prevailing party” in the litigation within the meaning of section 1354. This appeal followed.

II. Discussion

The issue in this case is whether the trial court properly ruled that Robinson was not the “prevailing party” in the litigation within the meaning of section 1354. Section 1354 states that CC&R’s may be enforced as “equitable servitudes” by “any owner of a separate interest or by the association, or by both,” and that the “prevailing party” in any enforcement action “shall be awarded reasonable attorney’s fees and costs.” ^{fn. 2}

[1a] The pivotal question here is how does a court determine who is the “prevailing party” for purposes of section 1354. The section itself provides no guidance and the issue has apparently not been decided by any court. [1572]

Robinson claims the court was obligated to adopt the definition found in the general cost statute, Code of Civil Procedure section 1032, subdivision (a)(4), which states a ” ‘[p]revailing party’ ” includes “a defendant in whose favor a dismissal is entered ….” Robinson argues that, since he was the recipient of a dismissal and was awarded his general litigation costs, he must also be deemed the prevailing party for purposes of section 1354.

However, the premise for this argument, that a litigant who prevails under the cost statute is necessarily the prevailing party for purposes of attorney fees, has been uniformly rejected by the courts of this state. (See McLarand, Vasquez & Partners, Inc. v. Downey Savings & Loan Assn. (1991) 231 Cal.App.3d 1450, 1456 [282 Cal.Rptr. 828] [“We emphatically reject the contention that the prevailing party for the award of costs under [Code of Civil Procedure] section 1032 is necessarily the prevailing party for the award of attorneys’ fees.”].) Furthermore, Code of Civil Procedure section 1032, subdivision (a) only defines ” ‘[p]revailing party’ ” as the term is used “in [that] section.” It does not purport to define the term for purposes of other statutes.

The association, for its part, claims the trial court was required to adopt the definition found in section 1717, subdivision (b)(2) which states, “Where an action has been voluntarily dismissed or dismissed pursuant to a settlement of the case, there shall be no prevailing party for purposes of this section.” However, section 1717 only applies “In any action … where the contract specifically provides that attorney’s fees and costs … shall be awarded ….” (Subd. (a), italics added.) Here, both sides agree there was no contract upon which attorney fees might be based. Instead, fees were sought pursuant to statute. ^{fn. 3}

While the definition of “prevailing party” found in section 1717, subdivision (b) or in Code of Civil Procedure section 1032 might otherwise be persuasive as to the meaning intended in section 1354, under the principle that similar language used in statutes “in pari materia” should be given similar effect (see, e.g., Isobe v. Unemployment Ins. Appeals Bd. (1974) 12 [1573] Cal.3d 584, 590-591 [116 Cal.Rptr. 376, 526 P.2d 528]; Housing Authority v. Van de Kamp (1990) 223 Cal.App.3d 109, 116 [272 Cal.Rptr. 584]), that rule of construction is of little help here. Section 1717, subdivision (b) and Code of Civil Procedure section 1032 are both “in pari materia” with section 1354 in a broad sense, yet they provide conflicting definitions of the critical term. Neither party to this appeal has supplied a principled reason why we should select one definition over the other.

Faced with this lack of authority, we examine how the courts have dealt with similar statutes. In Winick Corp. v. Safeco Insurance Co. (1986) 187 Cal.App.3d 1502 [232 Cal.Rptr. 479], the issue was whether a defendant, who obtained a dismissal with prejudice because the plaintiff failed to timely serve the summons, was a prevailing party within the meaning of section 3250 and entitled to attorney fees. The court observed that the term “prevailing party” as used in section 3250 had not been definitively interpreted, so it analogized the problem to a Supreme Court case in which the issue was whether a party had prevailed for purposes of awarding attorney fees under Code of Civil Procedure section 1021.5, the private attorney general statute. Noting the court in that case conducted a ” ‘pragmatic inquiry’ ” into whether a party prevailed, the Winick court conducted a similar pragmatic inquiry and concluded a defendant, who obtains a dismissal with prejudice because the plaintiff fails to timely serve the complaint, has also prevailed and is entitled to attorney fees. (187 Cal.App.3d at pp. 1506-1508.)

In Donald v. Cafe Royale, Inc. (1990) 218 Cal.App.3d 168 [266 Cal.Rptr. 804], the plaintiff, a physically disabled man, filed suit against a restaurant alleging it had violated the Civil Code by failing to provide him adequate access. Among other things, the plaintiff sought an injunction under section 55 barring the restaurant from continuing its violation in the future. While the suit was pending, the restaurant became insolvent and closed. The trial court ruled the restaurant was the prevailing party on the injunction and awarded it attorney fees. The plaintiff appealed the award and the appellate court reversed: “In the instant case [the plaintiff] filed his section 55 cause of action in order to enjoin [the restaurant’s] operation in violation of the pertinent statutes and administrative code provisions. The cessation of … operation of the restaurant achieved that result. Under these circumstances, it was an abuse of discretion for the court to determine that by going out of business and rendering the issue moot, [the restaurant] ‘prevailed’ for purposes of attorney fees. Neither party prevailed for purposes of an award of attorney fees on the cause of action for injunctive relief.” (218 Cal.App.3d at p. 185.)

In Elster v. Friedman (1989) 211 Cal.App.3d 1439 [260 Cal.Rptr. 148], the residents of a duplex sued their noisy neighbors and sought an injunction [1574] barring harassment under Code of Civil Procedure section 527.6. When the matter came to trial, the parties entered into a stipulated judgment wherein each side agreed not to harass the other. The trial court ruled that the plaintiffs had prevailed in the suit and awarded them attorney fees under Code of Civil Procedure section 527.6. The defendants then challenged this award and the appellate court affirmed. After noting the term “prevailing party” as used in that section had not been defined, the Elster court analyzed who had “prevailed” as a practical matter: “At bench, respondents wanted appellants to stop playing their music too loudly, to stop telephoning them in the middle of the night, and generally to leave them alone. Respondents got precisely that from the settlement. It is irrelevant that they were symmetrically bound by the injunction, since nothing in the record even hints that they were anything but the victims in this case. The injunction forbade respondents from doing what they apparently had never done and had no apparent desire to do. To consider this significant would be to elevate form over substance. [¶] We hold that the trial court did not abuse its discretion in concluding that respondents prevailed.” (211 Cal.App.3d at p. 1444.)

[2] Winick, Donald, and Elster all share a common theme. In each case, the court declined to adopt a rigid interpretation of the term “prevailing party” and, instead, analyzed which party had prevailed on a practical level. Donald and Elster further clarify that the trial court must determine who is the prevailing party, and that the court’s ruling should be affirmed on appeal absent an abuse of discretion. We conclude similar rules should apply when determining who the “prevailing party” is under section 1354.

[1b] Applying those rules here, we note that both the judge who conducted the special settlement conference, and the judge who ruled on the attorney fee request concluded there was no prevailing party in this litigation. We see no reason to doubt those rulings. The association voluntarily dismissed its complaint against Robinson as part of a global settlement agreement, not because he succeeded on some procedural issue or otherwise received what he wanted. That dismissal apparently was more the result of Robinson’s obdurate behavior rather than any successful legal strategy. While it might be possible to conjure a scenario where a litigant who refuses to participate in a settlement and then receives a voluntary dismissal without prejudice could be deemed the prevailing party, that is certainly not the case here.

Furthermore, the record before us is inadequate to seriously challenge the trial court’s rulings. While we have copies of the complaint and some of the cross-complaints, and are generally aware of the parties involved, we have no way of measuring the truth of the allegations which were made. [1575] [3] Robinson, as appellant, has the obligation to prove error through an adequate record. (9 Witkin, Cal. Procedure (3d ed. 1985) Appeal, § 418, pp. 415-416.) He has not done so.

III. Disposition

The order is affirmed.

King, J., and Haning, J., concurred.

A petition for a rehearing was denied February 15, 1994, and appellant’s petition for review by the Supreme Court was denied April 13, 1994. Mosk, J., and Kennard, J., were of the opinion that the petition should be granted.

FN 1. Unless otherwise indicated, all subsequent statutory references are to the Civil Code.

FN 2. Section 1354 was recently amended. (See Stats. 1993, ch. 303, § 1.) The language quoted above is now contained in subdivisions (a) and (f).

FN 3. This fact distinguishes the present case from the cases cited by the association. The question in Mackinder v. OSCA Development Co. (1984) 151 Cal.App.3d 728 [198 Cal.Rptr. 864], and in Huntington Landmark Adult Community Assn. v. Ross (1989) 213 Cal.App.3d 1012 [261 Cal.Rptr. 875], was whether attorney fees could be awarded under a fee clause contained in a development’s declaration of restrictions. In both cases, the court concluded that the declarations were contracts within the meaning of section 1717 and applied the rules for awarding attorney fees set forth in that section. (Mackinder v. OSCA Development Co., supra, 151 Cal.App.3d at pp. 738-739; Huntington Landmark Adult Community Assn. v. Ross, supra, 213 Cal.App.3d at pp. 1023-1024.) Here, by contrast, the CC&R’s do not include an attorney fees clause so fees were sought under a statute, section 1354.

Salehi v. Surfside III Condominium Owners Association

(2011) 200 Cal.App.4th 1146

[Attorney’s Fees; Prevailing Party] A HOA is deemed a prevailing party entitled to recover its attorney’s fees where the outcome of the lawsuit results in the HOA realizing its litigation objectives on a practical level.

Procter, Slaughter & Reagan, Slaughter & Reagan, William M Slaughter and Gabriele M. Lashly for Defendant and Appellant and for Defendant and Respondent.
Susan J. Salehi, in pro per., for Plaintiff and Respondent and for Plaintiff and Appellant.

OPINION
YEGAN, J.-

A party contemplating litigation to enforce the covenants, conditions, and restrictions (CC&Rs) of a condominium project should get the “ducks in a row.” That is to say, such party should be ready to go forward procedurally and prove its case substantively. Failure to do so subjects the losing party to an award of attorney fees. Here, a condominium owner, Susan J. Salehi, filed such a suit in propria persona against a condominium association (Association). In defending the suit, Association incurred attorney fees of a quarter million dollars. Based on faulty reasoning, Salehi dismissed eight of the ten causes of action on the eve of trial. She prevailed on no level whatsoever, let alone on a “practical level.” But the trial court denied Association any attorney fees, and Association appealed. We conclude that the denial was an abuse of discretion as a matter of law. Salehi did not realize her “litigation objectives” on these causes of action. Association did realize its “litigation objectives” and was the prevailing party on a “practical level.” It is entitled to attorney fees as mandated by the Legislature. We express no opinion on the amount of attorney fees that should be awarded on remand.

Salehi has filed her own appeal, which we conclude to be without merit. Accordingly, we reverse the order denying attorney fees and affirm in all other respects.

ASSOCIATION’S APPEAL

Factual and Procedural Background

In March 2004 Salehi, a licensed California attorney, purchased a condominium unit in Surfside III (Surfside), “a 309 [unit] condominium/townhome community in 8 buildings covering 15 acres adjacent to the ocean in Port Hueneme.” The community is governed by the CC&Rs which provide that Association “shall have the duty of maintaining, operating and managing the Common Area of the project.” [1151]

In May 2008 Salehi, in propria persona, filed a complaint against Association. The operative pleading alleges 10 causes of action. The gravamen of the complaint is that, in violation of the CC&Rs, Association failed to “appropriately maintain and repair Surfside” and to “maintain an adequate reserve fund for the replacement of the common area facilities.”

The fourth and sixth causes of action alleged negligent misrepresentation and fraud. These two causes of action were based on Association’s alleged failure to disclose Surfside’s physical and financial problems to Salehi before she purchased her condominium unit.

Salehi represented Paul Lewow in a similar Ventura County lawsuit against Association (case no. 56-2008-00313595-CU-BC-VTA). Like Salehi, Lewow had also purchased a condominium unit in Surfside. This matter was tried to the court, which issued a statement of decision on January 8, 2010. The trial court concluded that Lewow had failed to prove his case. Judgment was subsequently entered for Association.

Trial in the instant case was scheduled to begin on January 11, 2010, three days after the issuance of the statement of decision in the Lewow case. On January 4, 2010, Salehi informed Association’s counsel that Mark Rudolph, her expert on construction and building maintenance, had notified her that he had “a serious heart condition which will require surgery to repair.” Because Rudolph’s medical condition rendered him unavailable for trial, Salehi told counsel that she had “decided to dismiss all but the fraud and negligent misrepresentation causes of action without prejudice.” On January 8, 2010, the same day that the statement of decision was issued in the Lewow case, Salehi filed a request to dismiss without prejudice all of the causes of action except the fourth and sixth for negligent misrepresentation and fraud. The court clerk entered the dismissals as requested by Salehi.

On January 11, 2010, Salehi successfully moved to continue the trial on the remaining fourth and sixth causes of action because of Rudolph’s unavailability. She submitted Rudolph’s declaration and a medical report verifying his heart problems. According to Rudolph, on January 4, 2010, he informed Salehi “of the severity of [his] health condition.” Rudolph further declared: “I have very little energy and have been advised to avoid stress, curtail my activities as much as possible, and get as much rest as possible. [¶] . . . I am not able to participate in the trial at this time. I expect that the surgery will be sometime this month and . . . expect between six to eight weeks to recover.” The trial was continued to May 10, 2010.

In February 2010, Association moved to recover its attorney fees of $252,767 incurred in defending against the eight causes of action that Salehi [1152] had voluntarily dismissed. The motion was made pursuant to Civil Code section 1354 (section 1354), subdivision (c), which provides: “In an action to enforce the governing documents” of a common interest development, “the prevailing party shall be awarded reasonable attorney’s fees and costs.” Association claimed that the adverse decision in the Lewow case had motivated Salehi to request the dismissals: “Salehi must have realized that she would lose at her trial as well. In order to cut her losses, Salehi voluntarily dismissed” all of the causes of action except those for negligent misrepresentation and fraud.

In her declaration in opposition to the motion, Salehi explained that she had requested to dismiss only those causes of action as to which Rudolph was an essential witness because she believed that the trial court would not grant a continuance. Since the causes of action would be dismissed without prejudice, she could refile them later after Rudolph had recovered from surgery. At that time, Salehi believed that she would be able to proceed without Rudolph on the remaining negligent misrepresentation and fraud causes of action since they did not concern specific construction problems.

In a minute order, the trial court denied the motion for attorney fees. The court stated that, in rendering its decision, it had been guided by Heather Farms Homeowner’s Assn. v. Robinson (1994) 21 Cal.App.4th 1568 (Heather Farms). Based on Heather Farms, the court determined that Association was not a “prevailing party” for purposes of attorney fees within the meaning of section 1354 because it had not “prevailed on a practical level.” The court rejected Association’s claim “that the dismissal[s] [were] motivated by the adverse decision in the related” Lewow case. The court concluded: “In the final analysis, . . . the dismissal[s] seem[] to be due more to [Salehi’s] inexperience and poor decisions than any implied concession to the merits of [Association’s] case.”

Association is the Prevailing Party

[1] Section 1354 does not define “prevailing party.” It only provides that “the prevailing party shall be awarded reasonable attorney’s fees and costs.” (Id., subd. (c).) “The words ‘shall be [awarded]’ reflect a legislative intent that [the prevailing party] receive attorney fees as a matter of right (and that the trial court is thereforeobligated to award attorney fees) whenever the statutory conditions have been satisfied.” (Hsu v. Abbara (1995) 9 Cal.4th 863, 872.)

Association contends that, pursuant to Code of Civil Procedure section 1032 (section 1032), it was entitled to attorney fees as “costs.” Association relies on two subdivisions of section 1032. Subdivision (b) of section 1032 [1153] provides: “Except as otherwise expressly provided by statute, a prevailing party is entitled as a matter of right to recover costs in any action or proceeding.” Subdivision (a)(4) provides: ” ‘Prevailing party’ includes . . . a defendant in whose favor a dismissal is entered. . . .”

[2] “[T]he premise for [Association’s] argument, that a litigant who prevails under the cost statute is necessarily the prevailing party for purposes of attorney fees, has been uniformly rejected by the courts of this state. [Citation.] Furthermore, . . . section 1032, subdivision (a) only defines ‘ “[p]revailing party” ‘ as the term is used ‘in that section.’ It does not purport to define the term for purposes of other statutes.” (Heather Farms, supra, 21 Cal.App.4th at p. 1572; accord, Galvan v. Wolfriver Holding Corp. (2000) 80 Cal.App.4th 1124, 1128-1129 [definition of “prevailing party” in section 1032 inapplicable to Civil Code section 1942.4, subdivision (b)(2), which awards attorney fees to “prevailing party” in action for damages resulting from landlord’s collection of rent for substandard housing]; Gilbert v. National Enquirer, Inc. (1997) 55 Cal.App.4th 1273, 1276 -1277 [section 1032 definition inapplicable to Civil Code section 3344, subdivision (a), which awards attorney fees to “prevailing party” in action for unauthorized use of another’s name, voice, signature, photograph, or likeness].)

In denying Association’s motion for attorney fees, the trial court relied on Heather Farms, supra, 21 Cal.App.4th 1568. There, a homeowners’ association brought an action against a homeowner, Robinson, to enforce the CC&Rs of a residential development. The complaint “spawned a complex series of cross-complaints and subsidiary actions” involving numerous parties. (Id., at p. 1570.) After years of litigation, all of the parties except Robinson signed a settlement agreement. “[T]he settlement nonetheless required the association to dismiss its suit against Robinson ‘without prejudice.’ ” (Ibid.) The judge who negotiated the settlement found that there were no prevailing parties: ” ‘This dismissal is part of an overall complex piece of litigation . . . that’s been resolved by a negotiated settlement. There are no winners. There are no favorable parties in this case.’ ” (Id., at p. 1571.) Robinson subsequently moved to recover his attorney fees pursuant to section 1354. Robinson “maintained that since he had received a dismissal, he was the ‘prevailing party’ . . . .” (Ibid.) The trial “court agreed with the settlement judge and concluded there was no ‘prevailing party’ . . . within the meaning of section 1354.” (Ibid.)

[3] The appellate court upheld the trial court’s ruling. It concluded that, in determining who is the “prevailing party” within the meaning of section 1354, the trial court should analyze “which party . . . prevailed on a practical level.” (Heather Farms, supra, 21 Cal.App.4th at p. 1574.) Applying this [1154] analysis, the appellate court reasoned that there was no prevailing party because the homeowners’ association had dismissed its action against Robinson “as part of a global settlement agreement, not because he succeeded on some procedural issue or otherwise received what he wanted.” (Ibid.)

[4] In Santisas v. Goodin (1998) 17 Cal.4th 599, our Supreme Court implicitly applied the Heather Farms rationale to the award of contractual attorney fees: “[A]ttorney fees should not be awarded automatically to parties in whose favor a voluntary dismissal has been entered. In particular, it seems inaccurate to characterize the defendant as the ‘prevailing party’ if the plaintiff dismissed the action only after obtaining, by means of settlement or otherwise, all or most of the requested relief, or if the plaintiff dismissed for reasons, such as the defendant’s insolvency, that have nothing to do with the probability of success on the merits. . . . If . . . the contract allows the prevailing party to recover attorney fees but does not define ‘prevailing party’ or expressly either authorize or bar recovery of attorney fees in the event an action is dismissed, a court may base its attorney fees decision on a pragmatic definition of the extent to which each party has realized its litigation objectives, whether by judgment, settlement, or otherwise. [Citation.]” (Santisas v. Goodin (1998) 17 Cal.4th 599, 621-622.)

Here, the trial court determined that Association was not the prevailing party for purposes of attorney fees. “We review the trial court’s decision for abuse of discretion. (Heather Farms, supra, 21 Cal.App.4th at p. 1574.) ” ‘[D]iscretion is abused whenever . . . the court exceeds the bounds of reason, all of the circumstances before it being considered.’ [Citation.]” (State Farm Mut. Auto. Ins. Co. v. Superior Court, In and For City and County of San Francisco (1956) 47 Cal.2d 428, 432.) “In deciding whether the trial court abused its discretion, ‘[w]e are . . . bound . . . by the substantial evidence rule. [Citations.] . . . The judgment of the trial court is presumed correct; all intendments and presumptions are indulged to support the judgment; conflicts in the declarations must be resolved in favor of the prevailing party, and the trial court’s resolution of any factual disputes arising from the evidence is conclusive. [Citations.]’ [Citation.] We presume the court found in [Salehi’s] favor on all disputed factual issues. [Citation.]” (Strasbourger Pearson Tulcin Wolff Inc. v. Wiz Technology, Inc. (1999) 69 Cal.App.4th 1399, 1403.)

Thus, we presume that the trial court credited Salehi’s proffered reasons for dismissing without prejudice all of the causes of action except the fourth and sixth. According to Salehi, she requested the dismissals not because Association had prevailed in the Lewow case, but because her construction and building maintenance expert was unavailable. She intended to refile the dismissed causes of action after the expert had recovered from surgery. She [1155] did not dismiss the two causes of action for negligent misrepresentation and fraud because she believed that her expert would not be a necessary witness on those causes of action. Later, when a more experienced attorney advised her that the expert might be necessary for rebuttal, she decided to move for a continuance on the remaining causes of action. We are bound by the trial court’s acceptance of Salehi’s explanation for the dismissals. (See e.g., In re Marriage of Greenberg (2010) 194 Cal.App.4th 1095, 1099.) But that does not mean that Salehi prevails on Association’s appeal.

[5] We must conclude that the trial court abused its discretion as to who was the prevailing party. Its ruling exceeds the “bounds of reason.” We are hard pressed to explain how it reached its conclusion or how the holding of Heather Farms aids Salehi. The record does not suggest that Salehi would have prevailed on the merits. It does not appear that she was ready to go forward procedurally and prove the case substantively. To say that she was, somehow, the prevailing party on a “practical level” or that she realized her “litigation objectives” is to do violence to these legal phrases of art. Association was ready to defend on the merits and cannot be faulted because Salehi dismissed these causes of action.

Heather Farms is readily distinguishable. There, the dismissal was mandated by the terms of a global settlement. Here, the dismissals were based on Salehi’s faulty reasoning. The expert’s unavailability because of illness constituted good cause for a continuance. Salehi recognized that she had good cause for a continuance when, three days after the dismissals, she requested a continuance on the remaining fourth and sixth causes of action because of the expert’s illness. The trial court confirmed the showing of good cause by continuing the trial for four months to May 10, 2010.

When Salehi filed her request for dismissals on January 8, 2010, she should have known that her expert’s unavailability would constitute good cause for a continuance. The trial court would have abused its discretion had it denied a continuance in these circumstances. The expert was an essential witness, and Salehi had learned of his illness only seven days before the trial date. Rule 3.1332(c)(1) of the California Rules of Court provides: “Circumstances that may indicate good cause [for a continuance of the trial] include: . . . The unavailability of an essential lay or expert witness because of death, illness, or other excusable circumstances . . . .”

Instead of moving for a continuance on all of the causes of action, as a competent attorney would have done, Salehi dismissed eight of them. These dismissals were unnecessary because she was entitled to a continuance. The trial court would have abused its discretion had it denied a continuance in these circumstances. [1156]

[6] “In assessing litigation success, Hsu v. Abbara (1995) 9 Cal.4th 863, 877, . . . instructs: ‘[C]ourts should respect substance rather than form, and to this extent should be guided by ‘equitable considerations.’ ” (Castro v. Superior Court (2004) 116 Cal.App.4th 1010, 1019.) Even though Salehi’s dismissals were based on reasons unrelated to “the probability of success on the merits” (Santisas v. Goodin, supra, 17 Cal.4th at p. 621), it is unfair to deprive Association of its reasonable attorney fees. Because of Salehi’s dismissals, Association “realized its litigation objectives.” (Id., at p. 622.) The dismissals were due to Salehi’s faulty reasoning. To shield her from attorney fees liability would reward what the trial court characterized as her “poor decisions.” [7] She should not be able to take advantage of her own fault or wrong. (Civ. Code, § 3517.)

We make one further observation. At no time has Salehi claimed that the trial court should have awaited outcome of the two remaining causes of action before deciding who was the prevailing party “[i]n [the] action.” (§ 1354, subd. (c).) We only point out that prudence may dictate that the trial court postpone ruling on an attorney fees request until all causes of action have been resolved.

SALEHI’S APPEAL

Factual and Procedural Background

Almost four years before the 2008 filing of the instant action (the 2008 action), Salehi filed a separate action (the 2004 action) against Association alleging five causes of action: nuisance, breach of contract, breach of fiduciary duty, negligence, and declaratory relief (Ventura County Case No. Civ.229468). The gravamen of the 2004 action was that, in violation of the CC&Rs, Association had failed to maintain and repair the common area water pipes above Salehi’s unit. As a result of this failure, water had leaked from the pipes into her unit. The leaks had damaged Salehi’s property and had caused the growth of toxic mold. The 2004 complaint alleged that, before Salehi purchased her unit, Association had been “notified of incidents of common area water leakage, and other common area water intrusion in [Salehi’s] unit, and into other units, in the Surfside III complex.”

In August 2005 the parties signed a “Settlement Agreement and Mutual Release” that disposed of the 2004 action. Association agreed to pay Salehi $110,000. The parties agreed to release each other from all claims “which they ever had, may now have or may hereafter have . . . by reason of any act or omission, matter, cause or thing arising out of or connected with the Complaint, or which could have been alleged in the Complaint, including [1157] without limitation, any representation, misrepresentation or omission in connection with any of the above . . . .”

The agreement included an express waiver of the protection afforded by Civil Code section 1542 (section 1542), which provides: “A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.” The agreement set forth section 1542 verbatim and provided: “It is the intention of the Parties hereto that the foregoing general releases shall be effective as a bar to all actions, causes of action, suits, claims or demands of every kind, nature or character whatsoever,known or unknown, suspected or unsuspected, fixed or contingent, referred to above, except those reserved in this Agreement.” (Italics added.) “[T]he parties hereby acknowledge that they are aware that they or their attorneys may hereafter discover claims and facts in addition to or different from those which they now . . . believe to exist with respect to the subject matter of or any part to this release, but that it is nonetheless the intention of the Parties to hereby fully, finally, and forever settle and release any and all disputes and differences, known or unknown, suspected or unsuspected, as to the released matters.” (Italics added.) Thus, in 2005, Association “bought peace” with Salehi for any theoretical claims she may have had.

The 2008 action was filed almost three years after the signing of the Settlement Agreement and Mutual Release. At the time of trial of Salehi’s two remaining causes of action for negligent misrepresentation and fraud, Association made a pretrial motion in limine to exclude “all evidence of the fraud and misrepresentation which occurred prior to the signing [of] the release” in August 2005. Association contended that Salehi “cannot pursue any claims for damages which occurred before August . . . 2005, because she released all known and unknown claims against Association in the Settlement Agreement and Mutual Release.” The granting of the motion in limine would dispose of Salehi’s two remaining causes of action, since they were based on Association’s alleged failure to disclose Surfside’s physical and financial problems to Salehi before she purchased her unit in March 2004.

Salehi argued that the release applied only to known and unknown claims related to the common area plumbing leaks that had damaged her individual condominium unit. Salehi declared that, when she signed the release in August 2005, she “did not, and could not know that there was a complex-wide failure of the plumbing system and essentially every other major component of the common areas.” In her complaint in the 2008 action, Salehi alleged that Association had failed “to maintain, upkeep, and adequately repair the common areas, including but not limited to the drainage and [1158] sewage systems, the fresh water plumbing, the security gates, the roofs, the building exteriors and stairways, the elevators, the carports, the utility buildings, the subflooring,[] railings, balconies, patios, sidewalks, asphalt roadways, [and] lighting . . . .”

The trial court granted the motion in limine and entered judgment in favor of Association. Association filed a memorandum of costs in the amount of $7,056. The trial court denied Salehi’s motion to tax costs.

Non-Preclusive Effect of Order Denying Summary Adjudication of Issues

Before Association’s motion in limine, a different judge had denied its motion for summary adjudication on the issue of whether the 2005 release barred Salehi’s claims in the 2008 action. Salehi argues that, by granting the motion in limine, the trial court in effect reversed this earlier ruling without complying with Code of Civil Procedure section 1008, which limits a court’s jurisdiction to grant an application to reconsider its prior order.

[8] Salehi “has cited no case, and we know of none, suggesting that section 1008 bars the judge to whom a case is assigned for trial from ruling on an issue of law as to which another judge has previously denied summary adjudication. To read the statute that broadly would be a prescription for calcified and pointless trial proceedings grinding inexorably toward reversal on appeal for errors that could easily have been corrected but for a perceived lack of power to do so.” (Schmidlin v. City of Palo Alto (2007) 157 Cal.App.4th 728, 766.) “The non-preclusive effect of denial is explicitly recognized in the directive that a grant of summary adjudication as to some issues ‘shall not operate to bar’ relitigation of other issues ‘as to which summary adjudication was either not sought or denied.’ (Code Civ. Proc., § 437c, subdivision (n)(2).)” (Id., at p. 766, fn. 18.)

Evidence on the Issue of Claimed Ambiguity Of the 2005 Settlement Agreement

Salehi contends that the trial court erroneously “refused to allow [her] to present evidence concerning [her] intent in entering into the [2005] agreement.” We disagree. In support of her contention, Salehi cites page 95 of the reporter’s transcript of the hearing on the motion in limine. But this citation does not support her contention. At page 95 of the reporter’s transcript, Salehi asked the court to “find that [the 2005 release] is ambiguous and accept extrinsic evidence.” The court replied that it “could take evidence on the issue as to whether or not it’s ambiguous.” Salehi responded: “The [1159] evidence is what I’ve cited in the opposing papers, that the language that is in the recitals limits it. It explains, it shows the intent of why I signed the settlement agreement.”

[9] The trial court properly permitted Salehi to present extrinsic evidence as to whether the 2005 agreement was ambiguous. “[P]arol evidence is properly admitted to construe a written instrument when its language is ambiguous. . . . [¶] The decision whether to admit parol evidence involves a two-step process. First, the court provisionally receives (without actually admitting) all credible evidence concerning the parties’ intentions to determine ‘ambiguity,’ i.e., whether the language is ‘reasonably susceptible’ to the interpretation urged by a party. If in light of the extrinsic evidence the court decides the language is ‘reasonably susceptible’ to the interpretation urged, the extrinsic evidence is then admitted to aid in the second step – interpreting the contract. [Citation.]” (Winet v. Price (1992) 4 Cal.App.4th 1159, 1165.)

[10] Although Salehi told the court that her opposition to the motion in limine contained the relevant extrinsic evidence concerning her intent, it in fact contained no competent extrinsic evidence. Salehi declared, “I never intended to settle any claims other than for the specific repairs stated in the settlement agreement . . . .” Salehi did not indicate whether she had communicated this intent to Association. “[E]vidence of the undisclosed subjective intent of the parties is irrelevant to determining the meaning of contractual language.” (Winet v. Price, supra, 4 Cal.App.4th 1166, fn. 3.) “It is the outward expression of the agreement, rather than a party’s unexpressed intention, which the court will enforce. [Citation.]” (Id., at p. 1166.)

2005 Settlement Bars 2008 Claims

[11] Salehi asserts that the trial court should have let the jury determine whether the parties intended the 2005 release to encompass her claims in the 2008 action for negligent misrepresentation and fraud. Because there was no conflicting competent extrinsic evidence as to the parties’ intent, the interpretation of the release was a question of law for the court, not a question of fact for the jury. (City of Hope Nat. Medical Center v. Genentech Inc. (2008) 43 Cal.4th 375, 395; Parsons v. Bristol Development Co. (1965) 62 Cal.2d 861, 865.)

We “independently construe the writing to determine whether the release encompasses the present claim[s]” for negligent misrepresentation and fraud. (Winet v. Price, supra, 4 Cal.App.4th at p. 1166.) We conclude that the 2005 release bars the remaining two 2008 claims. [1160]

In Winet v. Price, supra, 4 Cal.App.4th 1159, the appellate court interpreted a release with similar language. Price was an attorney who performed services for Winet. Price sued Winet to recover legal fees, and the parties settled the matter. As part of the settlement, the parties released each other from all claims, whether known or unknown. Each party was represented by counsel during the negotiation of the release. Fifteen years later, Winet was sued concerning a partnership agreement that Price had drafted before the settlement agreement was signed. Winet cross-complained against Price, alleging that Price had committed malpractice in drafting the partnership agreement. Price moved for summary judgment, arguing that the release encompassed the malpractice claim. The trial court granted the motion.

[12] The appellate court upheld the trial court’s ruling. In determining “that the release was designed to extinguish all claims extant among the parties,” whether known or unknown, the appellate court considered the following factors: “First, Winet was represented by counsel and was aware at the time he entered into the release of possible malpractice claims against Price relating to certain services Price had rendered to him [but not relating to the drafting of the partnership agreement]. With this knowledge and the advice of counsel concerning the language of (and the import of waiving) section 1542, Winet expressly assumed the risk of unknown claims. Second, it is significant that the parties were able to, and did, fashion language memorializing their agreement to preserve identified claims from the operation of the release when such was their intention . . . . Finally, Winet was represented by his own counsel, who explained to Winet the import of the release in general and of the waiver of section 1542 in particular. Under these circumstances we may not give credence to a claim that a party did not intend clear and direct language to be effective. [Citation.]” (Winet v. Price, supra, 4 Cal.App.4th at p. 1168, fn. omitted.)

The rule and rationale of Winet apply here. Like Winet, Salehi was also represented by counsel during the negotiation of the release. In the absence of evidence to the contrary, we presume that counsel explained to Salehi “the import of the release in general and of the waiver of section 1542 in particular.” (Winet v. Price, supra, 4 Cal.App.4th at p. 1168.) The settlement agreement states: “THE PARTIES ACKNOWLEDGE THAT THEY HAVE BEEN ADVISED BY LEGAL COUNSEL AND ARE FAMILIAR WITH THE PROVISIONS OF CALIFORNIA CIVIL CODE § 1542 . . . .” Moreover, because Salehi was an attorney in her own right, she should have understood the import of the section 1542 waiver.

When Salehi signed the release in August 2005, she was aware of possible claims against Association in addition to the water leakage claims pertaining to her own unit. In a letter to Association months before the signing of the [1161] release, Salehi stated that Dura-Flo, a plumbing contractor, had estimated it would cost “over $1.2 million to line all of the copper pipes only.” Salehi inquired, “Which is correct: We have few plumbing problems or we have such extensive problems that we need a $1.2 million fix?” Salehi asked Association to “provide details to support [its] response including any inspection or estimate to repair the drains.” So, Salehi knew, or should have known, of additional theoretical claims. Despite this knowledge, she “expressly assumed the risk of unknown claims.” (Winet v. Prince, supra, 4 Cal.App.4th at p. 1168.)

Finally, “it is significant that the parties were able to, and did, fashion language memorializing their agreement to preserve identified claims from the operation of the release when such was their intention . . . .” (Winet v. Price, supra, 4 Cal.App.4th at p. 1168.) For example, the release expressly did not apply to Salehi’s “obligation to pay Homeowner Association dues and assessments” or to “any obligations or restraining orders created by virtue of Ventura County Superior Court Case Number CIV229468 [the 2004 action].”

Accordingly, we reject Salehi’s argument that the 2005 release did not apply to unknown claims against Association that arose prior to the release. “If an argument such as this were given currency, a release could never effectively encompass unknown claims. A releasor would simply argue that release of unknown or unsuspected claims applied only to known or suspected claims, making it ineffective as to unknown or unsuspected claims.” (Winet v. Price, supra, 4 Cal.App.4th at p. 1167.)

Denial of Motion to Tax Costs

Salehi contends that the trial court abused its discretion in denying her motion to tax costs because “the costs which [she] sought to have taxed were incurred in defending the dismissed causes of action and were not reasonable or necessary for trial of the two remaining causes of action.” Salehi’s contention is without merit. Association sought costs pursuant to the costs statute, section 1032. Association was entitled to costs on the dismissed causes of action pursuant to subdivision (a)(2) of section 1032, which provides, ” ‘Prevailing party’ includes . . . a defendant in whose favor a dismissal is entered . . . .”

[13] Moreover, Salehi has forfeited the contention that costs “were not reasonable or necessary” as to the two remaining causes of action because she failed to provide supporting legal argument with references to the record. “[T]he trial court’s judgment is presumed to be correct, and the appellant has the burden to prove otherwise by presenting legal authority on each point [1162] made and factual analysis, supported by appropriate citations to the material facts in the record; otherwise, the argument may be deemed forfeited. [Citations.]” (Keyes v. Bowen (2010) 189 Cal.App.4th 647, 655-656.) “The appellant may not simply incorporate by reference arguments made in papers filed in the trial court, rather than brief them on appeal. [Citation.]” (Id., at p. 656.)

CONCLUSION

The order denying Association’s motion for attorney fees is reversed, and the matter is remanded to the trial court for determination and award of reasonable attorney fees to Association. The judgment as to causes of action four and six and the post -judgment order denying Salehi’s motion to tax costs are affirmed. Association shall recover its costs on both appeals.

Gilbert, P.J., and Perren, J., concurred.

Smith v. Laguna Sur Villas Community Association

(2000) 79 Cal.App.4th 639

[Association Records; Attorney-Client Privilege] A HOA, the corporate entity, is entitled to claim attorney-client privilege for communications between the HOA and its attorneys. The HOA’s members are not the holders of the privilege; rather, the HOA’s Board of Directors is the holder of the privilege.

Lee H. Durst and Nancy M. Padberg for Plaintiffs and Appellants.
Richard A. Tinnelly, Bruce R. Kermott, Aliso Viejo, and Deborah Cameron Vian for Defendant and Respondent.

OPINION

CROSBY, J.

Condominium associations may bring construction defect lawsuits against developers without fear of having to disclose privileged information to individual homeowners. Like closely-held corporations and private trusts, the client is the entity that retained the attorney to act on its behalf.

This litigation has its genesis in a construction defect action involving a 253-unit condominium project in the Laguna Sur development of the City of Laguna Niguel. The project was governed by the Laguna Sur Villas Community Association (Villas). Another group, the Laguna Sur Community Association (the Master Association), owned the development’s open space.^{[FN. 1]}

In June 1990, both associations jointly retained the law firm of Duke, Gerstel, Shearer & Bregante to sue the developer. They split the legal fees and shared expenses for soils and structural experts.

The litigation proved to be more costly than anticipated and by August 1991 the fees exceeded $450,000. That fall the Villas’ board of directors adopted an emergency assessment of $2,000 per unit. The assessment was imposed without polling the members.

A dissident group of Villas residents was upset by the “runaway budget for expenditures” and demanded to review Duke, Gerstel’s work product and legal bills “within 15 days from their receipt by the Association or its representatives.” Villas objected on the grounds of attorney-client and work product privileges.

Plaintiff Leslie Smith also made the same demand to Villas in his capacity as a board member. However, Smith served as a director of the Master Association, not Villas. He voluntarily resigned from the Master Association in June 1992.^{[FN. 2]}

The dissidents sought to recall the Villas board members for fiscal mismanagement, but lost the recall vote. The Villas board thereafter recommended an additional special assessment of $4,000 per unit. This [323] new assessment was ratified by a membership vote in 1993.

The dissidents responded with individual small claims actions against the Villas’ directors to recover the amount of the 1991 and 1992 assessments. They separately sued Villas in superior court for declaratory and injunctive relief. Villas in turn sued them for abuse of process and declaratory relief. The actions were consolidated.

After trial, the court found the 1991 special assessment was valid; Villas held the attorney-client privilege; and Smith’s inspection rights as a director were moot. Villas dismissed its damage claim for abuse of process. The court awarded attorney fees and costs to Villas as the prevailing party pursuant to Code of Civil Procedure section 1033.5 and Civil Code sections 1717 and 1354.

The court correctly held Villas was the holder of the attorney-client privilege and that individual homeowners could not demand the production of privileged documents, except as allowed by the Villas board.

Villas brought the construction defect litigation on its own behalf. California law expressly permits a mutual benefit non-profit corporation to “institute, defend, settle, or intervene in litigation … in its own name as the real party in interest and without joining with it the individual owners” in actions for damage to the common areas or for separate areas which it must repair or maintain. (Code Civ. Proc., § 383.) This represents a substantive change in previous case law which only accorded individual owners standing to sue. (Raven’s Cove Townhomes, Inc. v. Knuppe Development Co. (1981) 114 Cal. App.3d 783, 792, 171 Cal.Rptr. 334.)^{[FN. 3]}

Corporations have a separate legal identity and enjoy the benefit of the attorney-client privilege. (Hoiles v. Superior Court (1984) 157 Cal.App.3d 1192, 1198, 204 Cal.Rptr. 111.) Evidence Code section 951 defines a “client” as the “person” who “directly or through an authorized representative, consults a lawyer for the purpose of retaining the lawyer….” The term “person” includes a corporation (Evid.Code, § 175); indeed, it may extend to an unincorporated organization “when the organization (rather than its individual members) is the client.” (Cal. Law Revision Com. com, 29B Pt. 3 West’s Ann. Evid.Code (1995 ed.) foll., § 951, p. 207.) There is no statutory exception for shareholders, even for closely held entities, and courts are powerless to elaborate upon the legislative scheme. (Dickerson v. Superior Court (1982) 135 Cal.App.3d 93, 99, 185 Cal.Rptr. 97.)

Although appellants, as condominium owners, were members of Villas, they were not individually named as plaintiffs in the construction defect litigation. Because they did not consult with or retain the Duke, Gerstel law firm, they do not fit within the joint-client exception of Evidence Code section 962. (Hoiles v. Superior Court, supra, 157 Cal.App.3d at p. 1199, fn. 4, 204 Cal.Rptr. 111; see also Wells Fargo Bank v. Superior Court (2000) 22 Cal.4th 201, 212, 91 Cal.Rptr.2d [324] 716, 990 P.2d 591[“no such [joint client] relationship is implied in law”].)

Appellants argue they were the “true clients” of Duke, Gerstel rather than Villas, a “faceless” association which could only act in a “representative” capacity of the general membership. They contend Villas owed them a fiduciary duty to act in their best interests as “the rightful owners who are paying with their assessments for the legal services being rendered on their behalf.” They characterize as the “crux” of the matter the question: “For whose benefit is the lawsuit being brought?”

We have squarely rejected this equation between beneficiaries and allegedly true clients. In Holies v. Superior Court, supra, 157 Cal.App.3d 1192, 204 Cal.Rptr. 111, we held that only closely-held corporations, not minority shareholders, were the client of the corporation’s attorney even though the corporate board members owed fiduciary duties to the complaining shareholders. In Shannon v. Superior Court (1990) 217 Cal.App.3d 986, 266 Cal. Rptr. 242, another court held a receiver could assert an absolute attorney-client privilege as to communications with his counsel even as to a disclosure request by the corporation which was placed into receivership and to which he owed fiduciary responsibilities.

Most recently, in Wells Fargo Bank v. Superior Court, supra, 22 Cal.4th 201, 209, 91 Cal.Rptr.2d 716, 990 P.2d 591, the Supreme Court refused to create a so-called “fiduciary” exception to the attorney-client privilege because courts “do not enjoy the freedom to restrict California’s statutory attorney-client privilege based on notions of policy or ad hoc justification.” In Wells Fargo the beneficiaries of a trust sought to discover confidential communications between the trustee (a bank) and outside trust counsel. Like appellants, the beneficiaries contended the trustees owed independent duties to provide them with complete and accurate information regarding the trust administration and to allow them to inspect books and documents. All to no avail, for the court declined to allow such responsibilities to trump the statutorily-created attorney-client privilege: “Certainly a trustee can keep beneficiaries `reasonably informed’ [citation] and provide `a report of information’ [citation] without necessarily having to disclose privileged communications…. If the Legislature had intended to restrict a privilege of this importance, it would likely have declared that intention unmistakably, rather than leaving it to courts to find the restriction by inference and guesswork….” (Id. at p. 207, 91 Cal.Rptr.2d 716, 990 P.2d 591.) Wells Fargo held that the attorneys only represented the trustees, not the beneficiaries.

The Supreme Court was not persuaded to the contrary because the beneficiaries were indirectly paying attorney fees which came out of the trust. That is because “[p]ayment of fees does not determine ownership of the attorney-client privilege…. In any event, the assumption that payment of legal fees by the trust is equivalent to direct payments by beneficiaries is of dubious validity…. [T]his question of cost allocation does not affect ownership of the attorney-client privilege.” (Wells Fargo Bank v. Superior Court, supra, 22 Cal.4th at p. 213, 91 Cal.Rptr.2d 716, 990 P.2d 591.)

Here, too, appellants did not individually arrange to pay their proportionate fees of the Duke, Gerstel legal fees; instead, the fees were billed to and paid by Villas, which drew its funds from the member assessments. As in Wells Fargo, such indirect payments do not suffice to create an attorney-client relationship.

It is no secret that crowds cannot keep them. Unlike directors, the residents owed no fiduciary duties to one another and may have been willing to waive or breach the attorney-client privilege for reasons unrelated to the best interests of the association. Some residents may have had no defects in their units or may have had familial, personal or professional relationships with the defendants. Indeed, it [325] is likely that the developer in the underlying litigation itself may have owned one or more unsold units within the complex. As Villas points out, “[o]ne can only imagine the sleepless nights an attorney and the Board of Directors may incur if privileged information is placed in the hands of hundreds of homeowners who may not all have the same goals in mind.” With the privilege restricted to an association’s board of directors, this is one worry, at least, that their lawyers can put to rest.

III

As an alternative to their rights as homeowners, appellants argue that Smith and another individual, Hunter Wilson, were entitled to copies of the billing documents in the construction defect litigation in their separate capacity as directors and that their written demands to view the “attorney bills, reports and documents” were ignored.

We provided a “short answer” to a similar claim in Hoiles v. Superior Court., supra,157 Cal.App.3d at p. 1201, 204 Cal. Rptr. 111. We do so again. No such claim is contained in the complaint. Appellants’ contention is meritorious in the abstract since directors do have the right to request privileged information in their capacity as fiduciaries. However, it is specious in the particular. Neither Smith nor Wilson was a director of the association they sued. They were directors of the Master Association, not Villas. As counsel pointed out to the court: “Mr. Smith is trying to seek … rights of inspection by suing Laguna Sur Villas. It is a separate and distinct corporation which he never sat on as a director….”^{[FN. 4]}

Appellants make a meritless argument that the two associations “operated as one in the … construction defect litigation” and shared legal expenses. That is a nonsequitur. There was no attempt to establish that the two associations were alter egos of one another, and each maintained a separate legal existence.

Moreover, as the trial court observed, Smith’s rights (if any) as a director of either association ceased when his term expired in 1992. In Chantiles v. Lake Forest II Master Homeowners Assn. (1995) 37 Cal.App.4th 914, 920, 45 Cal. Rptr.2d 1, we acknowledged the rule that “`the right of a director [of a nonprofit corporation] to inspect the books and records of the corporation ceases on his removal as a director, by whatever lawful means[.]'” This issue was thus moot even before the time of trial, and Smith had no reason to pursue it here.

Appellants question the 1991 emergency assessment because “there was no emergency….” The court, however, ruled that appellants had failed to prove this contention “without the actual documentation” that Villas had adequate cash reserves to pay for consultants and repairs to the damaged common property.

That failure of proof manifests itself here as well. If there is a legal argument disguised somewhere in appellants’ briefs, it is too well hidden for us. Appellants have not affirmatively established error to overcome the presumption in favor of the ruling below. (Fundamental Investment etc. Realty Fund v. Gradow (1994) 28 Cal. App.4th 966, 971, 33 Cal.Rptr.2d 812.)

The judgment, including the fee award to respondent as prevailing party, is affirmed. Costs on appeal, including reasonable attorney fees to be assessed by the superior court, are awarded to respondent.

SILLS, P.J., and RYLAARSDAM, J., concur.

FN. 1 – The two boards had two or three common members and occasionally met collectively for informal workshops, but otherwise maintained a separate legal existence.

FN. 2 – Smith erroneously pleaded that he was a Villas director in 1991 and 1992. He never sued the Master Association.

FN. 3 – Smith raises for the first time in his reply brief the purported impact of recent legislation (Civ.Code, § 1375, subd. (g)) requiring associations to provide notice to individual owners of rejected settlement offers by builders or of proposed civil actions by the association and to allow for a special meeting of the members to discuss the matter. Aside from the impropriety of raising issues for the first time by reply brief (City of Costa Mesa v. Connell(1999) 74 Cal.App.4th 188, 197, 87 Cal.Rptr.2d 612), we fail to see the statute’s relevance. Under the statute, for example, the notice requirements do not come into play when an association’s board of directors accepts a developer’s written settlement offer, or where it agrees to submit to alternative dispute resolution after meeting and conferring with the developer. (Civ.Code, § 1375, subds. (e)(3), (g) [“If the board of directors of the association rejects a settlement offer presented at the meeting …”].)

FN. 4 – Appellants also tell us that “Abel Armas” was a board member of the Villas Association and that he, too, futilely made inspection requests of his fellow Villas board members. But Armas is not a party to the instant lawsuit, and there is no record he made any requests for documents.

Colony Hill v. Ghamaty

(2006) 143 Cal.App.4th 1156

[Rent Restrictions; Single-Family Use] A “single-family” use restriction in the association’s CC&Rs could prohibit an owner from renting portions of his unit to separate, unrelated individuals that did not have any pre-existing or ‘familial’-type relationship with each other. Such a restriction did not violate the owner’s rights of privacy under the California Constitution.

Rutan & Tucker, LLP, Stephen A. Ellis and Gerard M. Mooney, Jr. for Defendant and Appellant.
Hecht Solberg Robinson Goldberg & Bagley LLP, Jerold H. Goldberg and Joshua A. Sonn for Plaintiff and Respondent. [143 Cal.App.4th 1160]

OPINION
MCCONNELL, P. J.-

Defendant Masood Ghamaty appeals a judgment for plaintiff Colony Hill on its declaratory relief action. Ghamaty contends the trial court erred by finding the serial rental of rooms in his condominium violated Colony Hill’s restriction limiting the home’s use to single-family dwelling purposes, and the use restriction is unreasonable and may not be maintained. We affirm the judgment and discuss this issue in the unpublished portion of this opinion.

Ghamaty also contends the court improperly granted Colony Hill contractual attorney fees under Civil Code section 1717. In the published portion of this opinion we dismiss the attorney fees issue for lack of jurisdiction because Ghamaty did not file a notice of appeal from the postjudgment order on the matter.

FACTUAL AND PROCEDURAL BACKGROUND

Colony Hill, a common interest subdivision located in the Mount Soledad area of La Jolla, California, consists of 40 condominiums, or “lots,” owned by the residents. Colony Hill is managed by the Board of Governors (the Board) of the homeowners association. Colony Hill is governed by a declaration of covenants, conditions and restrictions (the Declaration), as amended in 1983. The two relevant paragraphs of the Declaration read as follows:

” ‘2.6 Each Lot shall be improved, used and occupied for private, single-family dwelling purposes only, and no portion thereof nor any portion of the Common Area shall be used for any commercial purpose whatsoever.’ ” (Italics added.)

” ‘2.7.8 Each Owner shall have the right to lease his [or her] Lot, provided the following conditions are satisfied: (a) each such lease shall be in writing and shall be submitted to the Board if requested; (b) each lease shall provide that the tenant shall be bound by and obligated to the provisions of this Declaration, the Bylaws and the rules and regulations promulgated by the Board and shall further provide that any failure to comply with the provisions of such documents shall be a default under the lease; (c) the name of each person residing upon a Lot pursuant to any such lease shall be provided to the Board; and (d) no Owner shall lease his [or her] Lot for transient or hotel purposes.’ “

In 2000 Ghamaty became an owner of a four-bedroom, three-bathroom home at Colony Hill. Ghamaty occupies the home himself, and he has also rented rooms to six persons at various times, for periods of between two months and two years. Ghamaty charged rents of between $300 and $550 per [143 Cal.App.4th 1161] month, plus a share of the utilities. Each renter had the exclusive use of a bedroom and a bathroom, and the nonexclusive use of the living room and kitchen. The shortest-term renter was a cousin of Ghamaty, but the other renters were unrelated to him. The rental agreements were oral and Ghamaty did not notify Colony of his tenants’ names.

In early 2002 the Board notified Ghamaty it had learned he had one or more renters at his home in violation of the Declaration’s requirement that it be used only as a single-family dwelling. The Board demanded that Ghamaty “return the property to a private single-family dwelling status immediately.” Ghamaty disagreed with the Board, taking the position he could rent rooms to whomever he wished under paragraph 2.7.8 of the Declaration. The parties exchanged more correspondence on the matter to no avail.

In a May 2003 letter, the Board notified Ghamaty a resident had complained about a party at his residence, during which guests parked in no-parking areas and blocked driveways and loud music was played. The letter stated that if the Board received any additional complaint of excessive noise it would require “that all non-family members cease living at your house.” In a July 2003 letter, the Board notified Ghamaty about some type of incident with one of his renter’s cars. The letter reminded Ghamaty that homes were to be used for single-family purposes only and “suggest[ed] that you or your father sell the house and you move to a neighborhood where renters are allowed.”

On July 17, 2003, Ghamaty appeared at a Board meeting. A resident voiced concerns about parking issues, renters and a loud party at Ghamaty’s home. The resident complained that Ghamaty’s renting out rooms was a commercial enterprise the Declaration does not allow. Ghamaty told the Board he had spoken with an attorney regarding the single-family residence language in the Declaration, and Ghamaty “considers his renters as family.” The Board approved a motion finding that renting or leasing to multiple occupants constitutes a commercial enterprise not allowed under the Declaration.

The Board meeting did not resolve the matter, and in April 2004, after unsuccessfully seeking binding arbitration, Colony Hill sued Ghamaty for breach of the Declaration, injunctive relief and declaratory relief. A bench trial was held on February 25, 2005. In lieu of live testimony, the parties stipulated to certain facts and exhibits and submitted the matter for a tentative judgment before presenting closing arguments. In his trial brief, Ghamaty relied on the San Diego Municipal Code’s definition of “family,” which is “two or more persons related through blood, marriage or legal adoption . . . or unrelated persons who jointly occupy and have equal access to all areas of a dwelling unit and who function together as an integrated economic unit.” (San Diego Mun. Code, § 113.0103.) [143 Cal.App.4th 1162]

In its tentative ruling, the court found Ghamaty’s rentals violated the Declaration. The court determined that under paragraphs 2.6 and 2.7.8 ^[FN.1] of the Declaration the “only commercial activity allowed is the right to lease a unit under specific conditions which [Ghamaty] failed to meet.” The court relied on the San Diego Municipal Code definition that Ghamaty submitted, and determined that by renting rooms he was not using the home for single-family purposes. The court ruled that under the Municipal Code definition, Ghamaty “may lease his entire unit to tenants who are responsible for the entire unit jointly and severally and who function as an integrated economic unit; i.e.[,] one lease whereby all tenants are jointly and severally responsible for all obligations under the lease, including rent.”

The court explained that if Ghamaty’s position were accepted, “one of the tenants may be violating the Rules and Regulations by emanating loud noise from his bedroom and [Colony Hill] could only enforce the rule against that individual person rather than all tenants of one unit. Other dwellers of the unit could claim no violation as they had no responsibility for the acts in the one bedroom. [Colony Hill] is not required to relate to each dweller as though [Ghamaty] were operating an apartment building within the unit.” The ruling further states that Colony Hill “is entitled to a copy of a written lease whereby each occupier (competent adult) agrees under one lease document to follow the [Declaration], By-laws, and Rules and Regulations of [Colony Hill] jointly and severally as to the entire unit and common areas and it is entitled to the names of all the dwellers of the unit. [Colony Hill] is also entitled to one lease document under which all competent adult dwellers are an ‘integrated economic unit[,]’ i.e. jointly and severally liable for the lease payment for the unit.”

After arguments, the court confirmed its tentative ruling and adopted it as a statement of decision. The court entered judgment for Colony Hill on April 18, 2005, which declared Ghamaty was in violation of paragraphs 2.6 and 2.7.8 ^[FN.2] of the Declaration, and permanently enjoins him “from renting his unit to multiple renters other than in compliance with the declaration of this Court.”

Colony Hill then moved as the prevailing party for $29,987.50 in attorney fees, under paragraph 6.6 of the Declaration and section 1717 of the Civil Code, and $1,729.60 in other costs. The court awarded the full amount requested. [143 Cal.App.4th 1163]

DISCUSSION

I. Single-Family Dwelling

Ghamaty cursorily contends that because he lives in his Colony Hill home and is “fully subject” to the Declaration’s rules and regulations, the trial court erred by finding he was not using it for single-family dwelling purposes within the meaning of paragraph 2.6 of the Declaration. He asserts he did not violate the Declaration by merely engaging in the “incidental renting of rooms in his home to friends [he] considers to be like ‘family.’ ”

Ghamaty cites no authority from any jurisdiction to support the notion that the seriatim renting of rooms in one’s home constitutes single-family dwelling use. “Where a point is merely asserted by counsel without any argument of or authority for its proposition, it is deemed to be without foundation and requires no discussion.” (People v. Ham (1970) 7 Cal.App.3d 768, 783, disapproved on another ground in People v. Compton (1971) 6 Cal.3d 55, 60, fn. 3; People v. Sierra (1995) 37 Cal.App.4th 1690, 1693, fn. 2.)

In any event, Ghamaty’s contention lacks merit. The court used the definition of “family” that Ghamaty submitted for its consideration, which in relevant part is “unrelated persons who jointly occupy and have equal access to all areas of a dwelling unit and who function together as an integrated economic unit.” (San Diego Mun. Code, § 113.0103, italics added.) The parties have not cited us to any definition of “integrated economic unit” in the context of residential living arrangements, and we have found none in our independent research. Under the facts here, however, the term cannot reasonably be interpreted to include Ghamaty and his renters. Ghamaty adduced no evidence he had any prior relationship with five of six of the renters, or that any of the renters had any prior relationship with each other. Ghamaty conceded he found one of the renters by placing an ad in the newspaper. The renters all had separate oral month-to-month agreements and they lived at Ghamaty’s home for various periods, with some of the renters not even present during the terms of other renters. One of the renters was a cousin of Ghamaty, but he lived at the home only sporadically for two months.

The term “integrate” means “to form, coordinate, or blend into a function or unified whole.” (Merriam-Webster’s Collegiate Dict. (11th ed. 2006) p. 650.) The mere payment of rent and a share of the utilities to Ghamaty did not blend the group into any type of unified whole. Beyond Ghamaty’s self-serving statement at the Board meeting that he considered his renters [143 Cal.App.4th 1164] “family,” he produced no evidence suggesting he shared meals with or had any type of relationship with the renters, with the exception of the familial relationship with his cousin. The court properly ruled that by renting out rooms Ghamaty was not using his home for single-family dwelling purposes.

II. Reasonableness of Use Restriction

A. Applicable Law

[1] Ghamaty’s principal challenge is to the legality of the Declaration’s restriction of use to single-family dwelling purposes. The matter is governed by the provisions of the Davis-Stirling Common Interest Development Act, which was enacted in 1985. (Civ. Code, § 1350.) Civil Code section 1354, subdivision (a) provides the “covenants and restrictions in the declaration shall be enforceable equitable servitudes, unless unreasonable, and shall inure to the benefit of and bind all owners of separate interests in the development.” (Italics added.)

“Use restrictions are an inherent part of any common interest development and are crucial to the stable, planned environment of any shared ownership arrangement.” (Nahrstedt v. Lakeside Village Condominium Assn. (1994) 8 Cal.4th 361, 372 ( Nahrstedt).) “The restrictions on the use of property in any common interest development may limit activities conducted in the common areas as well as in the confines of the home itself. [Citations.] Commonly, use restrictions preclude alteration of building exteriors, limit the number of persons that can occupy each unit, and place limitations on — or prohibit altogether — the keeping of pets.” (Id. at p. 373.)

[2] In Nahrstedt, the court was required to determine what standard or test governs the enforceability of recorded equitable servitudes in common interest developments, a matter of legislative intent. (Nahrstedt, supra, 8 Cal.4th at pp. 375, 378-379.) The court held: “An equitable servitude will be enforced unless it violates public policy; it bears no rational relationship to the protection, preservation, operation or purpose of the affected land; or it otherwise imposes burdens on the affected land that are so disproportionate to the restriction’s beneficial effects that the restriction should not be enforced.” (Id. at p. 382.) [143 Cal.App.4th 1165]

The court also held that by using the term “unless unreasonable” in Civil Code section 1354, subdivision (a), the Legislature created a presumption of reasonableness and shifted the burden of proving otherwise to the party challenging the use restriction. (Nahrstedt, supra, 8 Cal.4th at p. 380.) Further, the court held “the reasonableness or unreasonableness of a condominium use restriction that the Legislature has made subject to [Civil Code] section 1354 is to be determined not by reference to facts that are specific to the objecting homeowner, but by reference to the common interest development as a whole.” (Nahrstedt, supra, 8 Cal.4th at p. 386.) ^[FN.3]

B. Ghamaty’s Showing
1

To prevail, Ghamaty was required to prove the single-family dwelling use restriction is “arbitrary, that it is substantially more burdensome than beneficial to the affected properties, or that it violates a fundamental public policy.” (Nahrstedt, supra, 8 Cal.4th at p. 386.) Further, he must do so in the context of Colony Hill as a whole. (Id. at p. 387.)

[3] Ghamaty contends the permanent injunction violates his right of privacy under the California Constitution, article I, section 1. ^[FN.4] “[A] land-use restriction in violation of a state constitutional provision presumably would conflict with public policy” (Nahrstedt, supra, 8 Cal.4th at p. 387), and the question is whether the right to privacy implicitly guarantees owners in a common interest development the right to rent out rooms in their homes under circumstances such as those here. (Ibid.)

As the Supreme Court has held, “the privacy provision in our state Constitution does not ‘encompass all conceivable assertions of individual rights’ or create ‘an unbridled right’ of personal freedom. [Citation.] The legally recognized privacy interests that fall within the protection of the state Constitution are generally of two classes: (1) interests in precluding dissemination of confidential information (‘ “informational privacy” ‘); and (2) interests in making personal decisions or in conducting personal activities free of interference, observation, or intrusion (‘ “autonomy privacy” ‘). [Citation.] [143 Cal.App.4th 1166] The threshold question in deciding whether ‘established social norms safeguard a particular type of information or protect a personal decision from public or private intervention,’ . . . must be determined from ‘the usual sources of positive law governing the right to privacy — common law development, constitutional development, statutory enactment, and the ballots arguments accompanying the Privacy Initiative.’ ” (Nahrstedt, supra, 8 Cal.4th at p. 387, citing Hill v. National Collegiate Athletic Assn. (1994) 7 Cal.4th 1, 35-36.)

Ghamaty relies on City of Santa Barbara v. Adamson (1980) 27 Cal.3d 123 (Adamson), and its progeny, City of Chula Vista v. Pagard (1981) 115 Cal.App.3d 785 (Pagard). Those cases, however, are inapplicable.

In Adamson, a city ordinance required that all occupants of a home be members of a family, and it defined family in relevant part as a group not to exceed five persons, excluding servants, ” ‘living together as a single housekeeping unit in a dwelling unit.’ ” (Adamson, supra, 27 Cal.3d at p. 127.) The appellant’s household consisted of a group of 12 unrelated adults who lived in a 24-room, 10-bedroom, 6-bathroom home. The evidence showed the residents “have become a close group with social, economic, and psychological commitments to each other. They share expenses, rotate chores, and eat evening meals together. . . . Emotional support and stability are provided by the members to each other; they enjoy recreational activities such as a trip to Mexico together; they have chosen to live together mainly because of their compatibility.” (Id. at pp. 127-128.)

In Adamson, the court held the city lacked a compelling public interest in restricting communal living to groups of five or fewer persons. The court found the ordinance’s “rule-of-five” did not promote the stated goals of ” ‘serv[ing] the public health, safety, comfort, convenience and general welfare and . . . provid[ing] the economic and social advantages resulting from an orderly planned use of land resources, and encourag[ing], guid[ing] and provid[ing] a definite plan for future growth and development’ ” of the city, or prohibiting activities of a commercial nature and developing and sustaining a suitable environment ” ‘for family life where children are members of most families.’ ” (Adamson, supra, 27 Cal.3d at pp. 131-132.)

The court noted the “rule-of-five is not pertinent to noise, traffic or parking congestion, kinds of activity, or other conditions that conceivably might alter the land-use-related ‘characteristics’ or ‘environment’ ” of the city. (Adamson, supra, 27 Cal.3d at pp. 132-133.) The court found the city’s stated goals could be satisfied by less restrictive means, such as regulating population [143 Cal.App.4th 1167] density based on floor space and facilities, regulating noise by enforcing ordinances and criminal statutes, and regulating traffic and parking by limiting the number of cars permitted a household and by off-street parking requirements. (Adamson, supra,27 Cal.3d at p. 133.)

In Pagard, supra, 115 Cal.App.3d 782, a city ordinance prohibited more than three unrelated persons from living together. At issue there were several communal households that were occupied by between 4 and 24 unrelated persons. (Id. at p. 791.) This court, in accordance with Adamson, held the ordinance was invalid as it had “but at most a tenuous relationship to the alleviation of the problems mentioned,” such as overcrowding, minimizing traffic and congestion and avoiding undue financial burden on the school system. (Id. at p. 793.)

Adamson and Pagard, however, involved governmental action, in contrast to this case. In Schmidt v. Superior Court (1989) 48 Cal.3d 370 (Schmidt), the court upheld the constitutionality of a mobilehome park owner’s rule that excluded persons under the age of 25 from residing in the park. The court rejected the plaintiffs’ argument, based on Adamson, supra, 27 Cal.3d 123, that the rule violated their right of privacy. The court explained the restriction in Adamson “was a state-imposed rule directly limiting an individual’s right to live with whom he or she wanted; in [that] case, a governmental body had made the substantive decision to limit individual living arrangements within a community.” (Schmidt, supra, 48 Cal.3d at p. 388.) Further, the court explained a park owner’s authority to adopt an age-based housing rule “arises from its general common law property rights in the mobilehome park. . . . Nothing in Adamson . . . suggests that constitutional guarantees are violated by the enactment of a statute which simply recognizes the continuing existence of a private property owner’s authority in this respect.” (Ibid.) ^[FN.5]

[4] Indeed, Ghamaty states in his opening brief that the “clear rule is . . . that the State may not utilize its power to interfere with a person’s choice of cohabitants, absent some compelling public interest or reasonable necessity for doing so.” (Italics added.) Ghamaty cites no authority for the proposition that a private developer may not impose on its project use restrictions such as those in paragraphs 2.6 and 2.7.8 of the Declaration. “A decision is authority only for the point actually passed on by the court and directly involved in the [143 Cal.App.4th 1168] case. General expressions in opinions that go beyond the facts of the case will not necessarily control the outcome in a subsequent suit involving different facts.” (Gomes v. County of Mendocino (1995) 37 Cal.App.4th 977, 985; Chevron U.S.A., Inc. v. Workers’ Comp. Appeals Bd. (1999) 19 Cal.4th 1182, 1195.)

Moreover, Adamson and Pagard pertained to the number of unrelated persons allowed to reside together. In Adamson, the evidence showed the residents were committed to each other and engaged in communal living by sharing expenses, chores, meals and travel. (Adamson, supra, 27 Cal.3d at pp. 127-128.) The court found the city’s ordinance defining “family” as including only five or fewer related persons living as ” ‘a single housekeeping unit in a dwelling’ ” (id. at p. 127) violated the plaintiffs’ right to live together as an “alternate family” because of the numerical limitation. (Id. at pp. 128, 134.)

Similarly, in Pagard, the unrelated persons lived in “religious family households” or “communal households.” (Pagard, supra, 115 Cal.App.3d at pp. 787, 788.) The city’s definition of family included ” ‘a group of not more than three persons . . . who need not be related, living in a dwelling unit as a single housekeeping unit and using common cooking facilities.’ ” (Id. at p. 789.) The families lived in single housekeeping units, and this court struck down the ordinance because of the numerical limitation. (Id. at p. 793.)

In contrast, the injunction here includes no numerical limitation. Rather, it precludes Ghamaty from using his home for purposes other than a single-family dwelling, and in determining the meaning of “family,” the court used the definition Ghamaty submitted. Again, that definition is “unrelated persons who jointly occupy and have access to all areas of a dwelling unit and who function together as an integrated economic unit.” (San Diego Mun. Code, § 113.0103, italics added.) As discussed, Ghamaty presented no evidence he and his various renters functioned together as an integrated economic unit. The injunction’s requirements that Ghamaty may enter into only one lease of his property at a time, and that lessees shall be jointly and severally liable for the lease payment, are reasonably intended to ensure the lessees are an “integrated economic unit.” The court employed practical means to preclude the serial renting of rooms, which, when considered on a larger scale, could destroy the single-family character of Colony Hill.

Ghamaty asserts the injunction “impermissibly speaks to the relationship between the residents of [his] home, rather than to the use of the [r]esidence itself.” (Original emphasis.) In both Adamson and Pagard, however, the [143 Cal.App.4th 1169] residents had relationships with each other and they satisfied the ordinances’ requirements that they constitute single housekeeping units. Ghamaty, by providing the court with a definition for “family,” effectively conceded he could not lease his property unless he and his lessees formed an “integrated economic unit.” (San Diego Mun. Code, § 113.0103.) In Pagard, this court explained the city was free to enact “an appropriately drawn ordinance, having due regard for the constitutional barriers to attain the municipality’s laudable stated goal to protect and promote family style living. [This] . . . may include for example a redefinition of ‘family’ to specify a concept more rationally and substantially related to the legitimate aim of maintaining a family style of living. Such definition of family should treat a ‘group that bears the generic’ characters of a family unit as a relatively permanent family household on an equal basis with the blood related family and thus should be equally entitled to occupy a single-family dwelling as its biologically related neighbor.” (Pagard, supra, 115 Cal.App.3d at pp. 796-797.)

[5] Ghamaty’s situation did not pertain to “family” in any sense of the word. Rather, he engaged in commercial activity prohibited by paragraph 2.6 of the Declaration, and the injunction is rationally related to Colony Hill’s right to maintain its family character by prohibiting uses other than for single-family dwelling purposes. Ghamaty did not meet his burden of showing the Declaration’s use restriction is unreasonable. (Nahrstedt, supra, 8 Cal.4th at p. 378.)

[6] Additionally, Ghamaty contends the injunction violates his right to contract under the state Constitution. Article I, section 9 of the California Constitution provides that a “bill of attainder, ex post facto law, or law impairing the obligation of contracts may not be passed.” (Italics added; see also U.S. Const., art. I, § 10 [“No state shall . . . pass any . . . law impairing the obligation of contracts”].) ” ‘A law or ordinance which substantially impairs a contractual obligation nonetheless may be constitutional. As the United States Supreme Court has noted, “[a]lthough the language of the Contract Clause is facially absolute, its prohibition must be accommodated to the inherent police power of the State ‘to safeguard the vital interests of its people.’ [Citation.]” ‘ ” (Mendly v. County of Los Angeles (1994) 23 Cal.App.4th 1193, 1210.)

“Although the federal contract clause has been interpreted to be ‘directed only against impairment by legislation and not by judgment of courts’ [citation], . . . the state contract clause has been construed also to apply to [143 Cal.App.4th 1170] judicial action.” (White v. Davis (2003) 30 Cal.4th 528, 548, citing Bradley v. Superior Court (1957) 48 Cal.2d 509, 519.) “[A] court cannot lawfully disregard the provisions of . . . contracts or deny to either party his [or her] rights thereunder.” (Bradley v. Superior Court, at p. 519.)

Ghamaty concedes he has found no case applying the contracts clause in the context of a permanent injunction. He relies on Barrett v. Dawson (1998) 61 Cal.App.4th 1048, in which the issue was whether a retroactive statute impaired the right to contract. The court explained that under federal law there is a three-step analysis. “The first and threshold step is to ask whether there is any impairment at all, and, if there is, how substantial it is. [Citation.] If there is no ‘substantial’ impairment, that ends the inquiry. If there is substantial impairment, the court must next ask whether there is a ‘significant and legitimate public purpose’ behind the state regulation at issue. [Citation.] If the state regulation passes that test, the final inquiry is whether means by which the regulation acts are of a ‘character appropriate’ to the public purpose identified in step two.” (Id. at pp. 1054-1055, citing Energy Reserves Group v. Kansas Power & Light (1983) 459 U.S. 400, 410-412.)

Ghamaty asserts the injunction destroys his “existing contractual relationships.” In support, he cites stipulated facts that six persons rented rooms from him for various terms. He cites no evidence that when the injunction issued any rental agreements were in force. In a deposition held approximately seven months before trial, Ghamaty testified that within the following few weeks he was going to terminate the two existing rental agreements and become the sole occupant of his home.

Ghamaty also complains that the injunction precludes him from “entering into separate contracts and dictates specific terms under which [he] must contract.” He essentially asserts the joint and several requirement of the injunction makes it impossible for him to rent out rooms as he did in the past. He claims it is unfair that he “would be required to locate renters willing to share liability for (a) the rent to be paid by all of the lessees and (b) any violations of [Colony Hill’s] rules and regulations and the [Declaration].”

[7] To any extent the three-part test discussed in Barrett v. Dawson, supra, 161 Cal.App.4th 1048 is arguably applicable in a judicial context, it is unhelpful to Ghamaty. The injunction does not substantially impair Ghamaty’s contract right, because under paragraphs 2.6 and 2.7.8 of the Declaration he must use his home only for single-family dwelling purposes, and he has no right to rent out rooms of his home when he and the renters do not function as an “integrated economic unit,” a definition he chose and the [143 Cal.App.4th 1171] court adopted. As the court concluded in Nahrstedt, supra, 8 Cal.4th at pages 383-384, “our social fabric is best preserved if courts uphold and enforce solemn written instruments [here the Declaration] that embody the expectations of the parties rather than treat them as ‘worthless paper’ . . . . Our social fabric is founded on the stability of expectation and obligation that arises from the consistent enforcement of the terms of deeds, contracts, wills, statutes, and other writings. To allow one person to escape obligations under a written instrument upsets the expectations of all the other parties governed by that instrument . . . that [it] will be uniformly and predictably enforced. [] The salutary effect of enforcing written instruments and the statutes that apply to them is particularly true in the case of the declaration of a common interest development.”

III. Attorney Fees

Ghamaty contends the award of attorney fees to Colony Hill should be reversed because Colony Hill only partially prevailed on its claims against him, as it did not recover any damages, and the court refused its request for a declaration that it was entitled to approve any lessee of Ghamaty. Alternatively, Ghamaty asserts the fee award should be substantially reduced.

We conclude, however, that we lack jurisdiction to consider the matter because Ghamaty did not appeal the postjudgment order awarding attorney fees. ^[FN.6] “An appellate court has no jurisdiction to review an award of attorney fees made after entry of the judgment, unless the order is separately appealed.” (Allen v. Smith(2002) 94 Cal.App.4th 1270, 1284.) ” ‘[W]here several judgments and/or orders occurring close in time are separately appealable (e.g., judgment and order awarding attorney fees), each appealable judgment and order must be expressly specified–in either a single notice of appeal or multiple notices of appeal–in order to be reviewable on appeal.’ ” (DeZerega v. Meggs (2000) 83 Cal.App.4th 28, 43.)

The judgment here was entered on April 18, 2005, and it stated, “Award of attorney’s fees and costs shall be determined by post-judgment application.” On May 27, 2005, Colony Hill moved for an award of fees and costs; on June 17, Ghamaty filed a notice of appeal of the judgment, and it did not refer to the pending motion on attorney fees or otherwise address the issue; on July 29, the court issued a tentative ruling granting the motion, and on August 8, [143 Cal.App.4th 1172] the court affirmed its ruling. Ghamaty did not then file a notice of appeal from the order on fees.

[8] In asserting his notice of appeal includes the postjudgment order on attorney fees, Ghamaty relies on Grant v. List & Lathrop (1992) 2 Cal.App.4th 993 (Grant). In Grant, the judgment expressly awarded attorney fees to certain parties, and the amounts of the awards were left blank for later insertion by the court clerk. Thereafter, the trial court set the amounts of the awards. The Court of Appeal rejected the argument it lacked jurisdiction over the fee issue, holding that “when a judgment awards costs and fees to a prevailing party and provides for the later determination of the amounts, the notice of appeal subsumes any later order setting the amounts of the award.” (Id. at p. 998.)

Here, in contrast to Grant, the judgment did not expressly award attorney fees to Colony Hill. Rather, it left the issues of entitlement and amount for later proceedings. In considering the applicability of the Grant exception, the court in DeZerega v. Meggs, supra, 83 Cal.App.4th at page 44, explained: “The issue . . . is not whether fees were ultimately recovered ‘as costs’ but whether the entitlement to fees was adjudicated by the original judgment, leaving only the amount for further adjudication.” Were we to extend Grant in the manner Ghamaty urges, a prevailing party would never have to file a separate appeal from a postjudgment order granting attorney fees. That of course, would be contrary to law.

Although notices of appeal must be liberally construed (Cal. Rules of Court, rule 1(a)(2)), we cannot construe Ghamaty’s notice of appeal to include the postjudgment order on fees. “The rule favoring appealability in cases of ambiguity cannot apply where there is a clear intention to appeal from only part of the judgment or one of two separate appealable judgments or orders. [Citation.] ‘Despite the rule favoring liberal interpretation of notices of appeal, a notice of appeal will not be considered adequate if it completely omits any reference to the judgment [or order] being appealed.’ ” (Norman I. Krug Real Estate Investments, Inc. v. Praszker (1990) 220 Cal.App.3d 35, 47.)

Ghamaty also contends we should consider the merits of the attorney fees issue because Colony Hill addressed the merits and did not raise the jurisdictional issue, and thus it would suffer no prejudice. Prejudice to a party, however, is not the test of whether we have jurisdiction to consider an issue. [143 Cal.App.4th 1173]

DISPOSITION

The judgment is affirmed. The purported appeal of the attorney fees award is dismissed. Colony Hill is entitled to costs on appeal.

O’Rourke, J., and Irion, J., concurred.

FN 1. The tentative ruling erroneously cites paragraph 2.7.9 of the Declaration.

FN 2. The judgment also erroneously cites paragraph 2.7.9 of the Declaration.

FN 3. In Nahrstedt, supra, 8 Cal.4th 361, the court concluded a use restriction that prohibited cats and dogs, but allowed domestic fish and birds, was reasonable. (Id.at pp. 369, fn. 3, 386.)

FN 4. That provision states: “All people are by nature free and independent and have inalienable rights. Among these are enjoying and defending life and liberty, acquiring, possessing, and protecting property, and pursuing and obtaining safety, happiness, and privacy.”

FN 5. In Schmidt, former Civil Code section 798.76 was at issue. It provided that the ” ‘management [of a mobilehome park] may require that a purchaser of a mobilehome which will remain in the park, comply with any rule or regulation limiting residence to adults only.’ ” (Schmidt, supra, 48 Cal.3d at p. 379.)

Tract 19051 Homeowners Association v. Kemp

(2015) 60 Cal. 4th 1135

[Attorney’s Fees Awards; Non-CID Action] Attorney’s fees may be recovered by the prevailing party under Civ. Code § 5975 in an action to enforce the governing documents regardless of whether the association is in fact a common interest development that is subject to the Davis-Stirling Act.

Marcia J. Brewer; Law Office of Mifflin & Associates and Ken Mifflin for Plaintiffs and Appellants.
Robert L. Jones, in pro. per., for Plaintiff and Appellant.
No appearance for Defendant and Respondent Maurice Kemp.
Turner Law Firm and Keith J. Turner for Defendant and Respondent Eric Yeldell.

OPINION

CANTIL-SAKAUYE, C. J.

The issue before us in this case is the validity of an attorney fee award granted in favor of defendant homeowners under former section 1354, subdivision (c), of the Civil Code, a provision of the Davis-Stirling Common Interest Development Act (hereafter the CID Act).^{[FN. 1]} The CID Act applies to various types of development projects, but a common interest development for purposes of the act requires a project with a common area. (See 9 Miller & Starr, Cal. Real Estate (3d ed. 2011) § 25B:1, pp. 25B-6 to 25B-7.) Former section 1354(c) — the attorney fee statute at issue here — provided in full: “In an action to enforce the governing documents, the prevailing party shall be awarded reasonable attorney’s fees and costs.” (Added by Stats. 2004, ch. 754, § 1, p. 5838.) The term “governing documents,” in turn, was defined in former section 1351, subdivision (j) (as amended by Stats. 2002, ch. 1111, § 1, pp. 7117-7118, now § 4150) to mean the official documents governing “the operation of [a] common interest development.”

The underlying lawsuit in this matter was filed by the Tract 19051 Homeowners Association and a number of individual members of the association (hereafter plaintiffs) against defendant homeowner Maurice Kemp. Plaintiffs’ first amended complaint alleged that their housing development tract No. 19051 (Tract 19051) — which included Kemp’s property — is a common interest development within the meaning of the CID Act. It further alleged that, pursuant to that act, there were valid restrictions applicable to defendant Kemp’s property that were violated by his ongoing remodeling. The trial court ultimately concluded that plaintiffs failed to establish that Tract 19051 constitutes a common interest development within the meaning of the CID [1139] Act and rendered judgment in favor of defendant Kemp and defendant Eric Yeldell, a subsequent purchaser of Kemp’s property who had been permitted to intervene as a defendant in the action. As part of the judgment, the trial court awarded defendants attorney fees under former section 1354(c).

The Court of Appeal affirmed the trial court’s judgment in favor of defendants on the merits, agreeing that plaintiffs had failed to prove that Tract 19051 satisfies the requirements of a common interest development, but the appellate court reversed the trial court’s award of attorney fees to defendants. Relying upon the prior Court of Appeal decision in Mount Olympus Property Owners Assn. v. Shpirt (1997) 59 Cal.App.4th 885, 895-896 (Mount Olympus), the Court of Appeal concluded that because both it and the trial court had found that the CID Act was not applicable, the trial court had erred in awarding attorney fees under former section 1354(c), a provision of that act.

Defendants sought review of the attorney fee issue in this court, contending that the Court of Appeal’s conclusion was not supported by the language of the applicable statute or by the Legislature’s intent to adopt a reciprocal attorney fee provision. We granted review to resolve the issue.

For the reasons discussed hereafter, we conclude that the Court of Appeal erred in reversing the attorney fee award in favor of defendants. First, the trial court’s award of attorney fees is supported by the language of the statute: Plaintiffs’ underlying lawsuit was an action to enforce the governing documents of a common interest development, and defendants were the prevailing party in the action. Second, because plaintiffs clearly would have been entitled to an award under the statute had they prevailed in the action, denying defendants an award under the statute when they were the prevailing party would unquestionably violate the reciprocal nature of the statute and thus defeat the evident legislative intent underlying the statute. As we shall explain, prior California decisions, interpreting and applying comparable statutory attorney fee provisions that mandate an award of attorney fees to the prevailing party, directly support this interpretation of former section 1354(c). Finally, the Court of Appeal decision in Mount Olympus, supra, 59 Cal.App.4th 885, upon which the Court of Appeal in this case relied in reaching a contrary result, is clearly distinguishable from the present case.

Accordingly, we reverse the judgment of the Court of Appeal insofar as it reversed the attorney fee award in favor of defendants.

I. Facts and Lower Court Proceedings

Tract 19051 is a housing development comprised of 94 single-family homes in the Baldwin Vista area of Los Angeles. A voluntary homeowners [1140] association — known variously as the Tract 19051 Homeowners Association or the Cloverdale, Terraza, Stillwater, Weatherford Homeowners Association — is open to homeowners whose homes are within, or in the immediate vicinity of, Tract 19051.

When Tract 19051 was subdivided in 1958, the developer recorded the declaration of restrictions (hereafter referred to as the declaration) that contained the restrictions at issue in the underlying lawsuit. The declaration allowed any homeowner to sue to enforce its restrictions, but the original declaration, by its own terms, expired on January 1, 2000, and contained no provision for extending that date.

In 2006, defendant Maurice Kemp acquired lot No. 22 of Tract 19051, which contained a one-story residence that Kemp substantially demolished in order to build a much larger 7,000 square-foot two-story home. After Kemp began construction, a neighbor’s attorney informed Kemp that the remodeling project was in violation of height and setback restrictions contained in the declaration.

In September 2008, plaintiffs filed the underlying lawsuit against Kemp, alleging breach of the declaration and seeking injunctive and declaratory relief; the first amended complaint explicitly alleged that Tract 19051 is a common interest development and claimed that plaintiffs were entitled to an award of attorney fees under former section 1354(c). In response, defendant argued that the declaration had expired by its own terms on January 1, 2000. Plaintiffs rejoined by maintaining that, under the terms of the CID Act, the termination date of the declaration had been extended to December 31, 2010, by a majority vote of the homeowners that occurred in December 1999. (See former § 1357, subd. (b), added by Stats. 1985, ch. 874, § 14, p. 2780, now §§ 4265, 4270 [when the declaration of a common interest development does not provide a means for the property owners to extend the term of the declaration, the term may be extended by a majority of members].) With regard to a development that does not qualify as a common interest development, a declaration of restrictions may be extended only by the unanimous vote of 100 percent of the property owners or by a vote of a lesser number of owners as provided in the declaration of restrictions. (See 8 Miller & Starr, Cal. Real Estate (3d ed. 2011) § 24:41, pp. 24-137 to 24-138 & fn. 9 [citing cases].) It is undisputed that neither of the latter two methods was satisfied here.

In denying a preliminary injunction sought by plaintiffs, the trial court found that the December 1999 vote by a majority of the Tract 19051 homeowners was not effective to extend the date of the declaration because “Tract 19051 is not a common interest development. . . . Tract 19051 is a [1141] tract of individually owned single family residences that border upon streets that are dedicated to the public and are not owned in common by the homeowners or by the homeowners’ association.”

When the case ultimately was ready for trial, however, Kemp was on the verge of losing his property to foreclosure and did not appear in court. The trial court initially entered an interlocutory judgment for plaintiffs and granted them attorney fees and costs under former section 1354(c), but reserved final judgment until plaintiffs provided proof that the declaration had been properly extended under the CID Act. Meanwhile, a new homeowner, Eric Yeldell, purchased Kemp’s home at a trustee’s sale and was granted permission to intervene as a defendant in the ongoing lawsuit. After further briefing and argument on additional questions relating to Tract 19051’s status as a common interest development, the trial court found that plaintiffs had failed to establish that Tract 19051 is a common interest development and consequently that plaintiffs’ attempt to extend the declaration through the process authorized under the CID Act was unsuccessful. The trial court vacated the interlocutory judgment in favor of plaintiffs, entered judgment for defendants, and awarded defendants attorney fees under former section 1354(c).

The Court of Appeal agreed with the trial court’s conclusion that plaintiffs had failed to establish that Tract 19051 was a common interest development within the meaning of the CID Act and consequently that the restrictions imposed by Tract 19051’s original declaration had not been extended by virtue of the procedure authorized by the CID Act. Accordingly, the Court of Appeal affirmed the trial court’s judgment in favor of defendants on the merits.

With regard to the trial court’s award of attorney fees in favor of defendants, however, the Court of Appeal reversed. In reaching this conclusion, the Court of Appeal stated in full: “In Mount Olympus, supra, 59 Cal.App.4th at pages 895-896,we found that because the [CID] Act did not apply, the trial court had erred in awarding attorney fees under section 1354. (See 12 Miller & Starr, Cal. Real Estate (3d. ed. 2008) § 34:66, p. 34-229 [`If the property described in the restrictions is not a “common interest development,” this provision for the award of fees does not apply.’].) Because the same rationale applies to this case, the attorney fee award under section 1354 must be reversed.”

Defendants petitioned for review of the Court of Appeal’s determination regarding the attorney fee award, and we granted review limited to that issue. Accordingly, we accept the lower courts’ determinations that Tract 19051 is not a common interest development within the meaning of the CID Act.

[1142]

II. When a defendant homeowner prevails in an action to enforce the governing documents of an asserted common interest development by showing that the subdivision is not a common interest development, is the defendant homeowner entitled to attorney fees under former section 1354(c) (now section 5975, subdivision (c))?

With regard to an award of attorney fees in litigation, California generally follows what is commonly referred to as the American Rule, which provides that each party to a lawsuit must ordinarily pay his or her own attorney fees. (See, e.g., Trope v. Katz (1995) 11 Cal.4th 274, 278.) The American Rule is codified in Code of Civil Procedure section 1021, which states in relevant part: “Except as attorney’s fees are specifically provided for by statute, the measure and mode of compensation of attorneys and counselors at law is left to the agreement, express or implied, of the parties. . . .”^{[FN. 2]}

As contemplated by the initial clause of Code of Civil Procedure section 1021, the Legislature has established a variety of exceptions to the American Rule by enacting numerous statutes that authorize or mandate an award of attorney fees in designated circumstances. (See generally 7 Witkin, Cal. Procedure (5th ed. 2008) Judgment, §§ 210-238, pp. 772-811 [discussing numerous examples of statutory provisions authorizing attorney fee awards].)

Former section 1354(c) — the provision at issue here — is one of the legislatively created attorney fee provisions. As noted above, former section 1354(c), a provision of the CID Act, read in full: “In an action to enforce the governing documents [of a common interest development], the prevailing party shall be awarded reasonable attorney’s fees and costs.” (Stats. 2004, ch. 754, § 1, p. 5838.)^{[FN. 3]} The parties disagree as to the meaning and proper application of this provision in a case in which it is ultimately determined that no common interest development exists.

[1143] The general principles that guide a court in determining the meaning and scope of a statutory provision are well established. As we explained in People v. Cornett (2012) 53 Cal.4th 1261, 1265: “`As in any case involving statutory interpretation, our fundamental task here is to determine the Legislature’s intent so as to effectuate the law’s purpose.’ [Citation.] `We begin with the plain language of the statute, affording the words of the provision their ordinary and usual meaning and viewing them in their statutory context, because the language employed in the Legislature’s enactment generally is the most reliable indicator of legislative intent.’ [Citations.] The plain meaning controls if there is no ambiguity in the statutory language. [Citation.] If, however, `the statutory language may reasonably be given more than one interpretation, “`”courts may consider various extrinsic aids, including the purpose of the statute, the evils to be remedied, the legislative history, public policy, and the statutory scheme encompassing the statute.”‘”‘”

In this case, each of the parties contends that the plain meaning of the statutory language supports its interpretation of the statute. To repeat, the applicable statute reads in full: “In an action to enforce the governing documents [of a common interest development], the prevailing party shall be awarded reasonable attorney’s fees and costs.” (Former § 1354(c), now § 5975, subd. (c).)

Plaintiffs contend that even when an action is brought to enforce what the complaint expressly alleges is a governing document of a common interest development, if it is ultimately determined in the course of the litigation that a common interest development does not exist, the action cannot properly be found to be “an action to enforce the governing documents” of a common interest development within the meaning of former section 1354(c). Plaintiffs assert in this regard: “In order for [former] section 1354(c) to apply, there must be an action to `enforce’ governing documents. This necessarily means that there must be valid `governing documents’ that are compliant with the Davis-Stirling Act to be `enforced’ in the first instance. Otherwise, the Act never applies, and the general rule that fees are not recoverable controls. . . . If there is nothing to enforce, then there can be no action to enforce.”

Defendants, in contrast, contend that the plain language of the statute supports their position. Defendants maintain that because the statute says that [1144] “the prevailing party” is entitled to recover attorney fees, the statute must be interpreted to be reciprocal, and “[r]ecovery is hinged solely on the basis of plaintiff’s action, not whether a court ultimately determines that a subdivision is a common interest development.” “[Plaintiffs] filed this action to enforce the governing documents. . . . Thus, the reciprocal, mandatory fee-shifting should kick in, whether [plaintiffs or defendants] prevailed.”

Focusing on the plain language of former section 1354(c), we conclude that defendants have the stronger argument. When a lawsuit is brought to enforce what the complaint expressly alleges are the governing documents of a common interest development, the action would ordinarily be understood to be “an action to enforce the governing documents [of a common interest development]” as that clause is used in former section 1354(c). Whether or not the plaintiff in the action is ultimately successful in establishing that the documents relied upon are in fact the governing documents of a common interest development would not affect the character or type of action that has been brought.

Moreover, even if the language of former section 1354(c) is viewed as potentially ambiguous in this regard, as we explain the additional factors discussed hereafter, taken as a whole, clearly support defendants’ contention that they were properly awarded attorney fees in this case under former section 1354(c).

The legislative history of former section 1354(c) makes it clear that the Legislature has long intended to provide for an attorney fee award to the “prevailing party” in actions covered by the statute. Although the initial version of former section 1354 in the original CID Act enacted in 1985 did not contain an attorney fee provision (Stats. 1985, ch. 874, § 14, p. 2777), when the statute was first amended in 1990 the following sentence was added to former section 1354: “In any action to enforce the declaration, the prevailing party shall be awarded reasonable attorney’s fees and costs.” (Stats. 1990, ch. 1517, § 3, p. 7108, italics added.) In 1993, the attorney fee provision (still providing for recovery by “the prevailing party”) was expanded and moved to former section 1354, subdivision (f). (Stats. 1993, ch. 303, § 1, p. 2053.) Then, in 2004, in a substantial revision of the CID Act, the attorney fee provision in question was moved from former section 1354, subdivision (f), to former section 1354(c). (Stats. 2004, ch. 754, § 1, pp. 5838-5839.) The 2004 amendment embodied the identical language that remained in effect at the time of the trial court’s order in this case. As noted above (ante, p. 1, fn. 1), as a result of the 2012 recodification of the CID Act, the identical language now appears in section 5975, subdivision (c).

Plaintiffs claim that the 2004 amendment that moved the attorney fee provision from former section 1354, subdivision (f) to former section 1354(c) [1145] worked a substantive, narrowing change in the statute because the language of section 1354, subdivision (f) that provided “[i]n any action to enforce the governing documents” was changed to “[i]n an action to enforce the governing documents. . . .” We are aware of no authority, however, to support the claim that in this context the two phrases (“any action” and “an action”) are reasonably interpreted to have different meanings, and other attorney fee statutes use the terms interchangeably. (See, e.g., Lab. Code, § 218.5.) Furthermore, plaintiffs’ contention is directly contradicted by the report of the California Law Revision Commission that proposed the changes embodied in the 2004 amendment. With respect to the change in question, the report stated that “the first sentence of former subdivision (f) is continued without substantive change in subdivision (c).” (Recommendation: Alternative Dispute Resolution in Common Interest Developments (Sept. 2003) 33 Cal. Law Revision Com. Rep. (2003) p. 711, italics added.)

Thus, throughout its history, the attorney fee provision of the CID Act has provided for an award of attorney fees to the “prevailing party.”

As this court noted in Jankey v. Lee (2012) 55 Cal.4th 1038, 1046: “The Legislature knows how to write both unilateral fee statutes, which afford fees to either plaintiffs or defendants, and bilateral fee statutes, which may afford fees to both plaintiffs and defendants. `When the Legislature intends that the successful side shall recover its attorney’s fees no matter who brought the legal proceeding, it typically uses the term“prevailing party.“‘” (Italics added.)

We have not found anything in the legislative history of former section 1354(c) to indicate that the Legislature specifically considered the scenario in which an action that was brought to enforce the governing documents of a common interest development proved unsuccessful because the trial court determined that no common interest development existed. As described below, however, past California decisions interpreting and applying other prevailing party attorney fee statutes demonstrate that the enactment of a prevailing party attorney fee provision generally reflects a legislative intent to adopt a broad, reciprocal attorney fee policy that will, as a practical and realistic matter, provide a full mutuality of remedy to plaintiffs and defendants alike. (See, e.g., Santisas v. Goodin (1998) 17 Cal.4th 599 (Santisas); Hsu v. Abbara (1995) 9 Cal.4th 863 (Hsu); Mechanical Wholesale Corp. v. Fuji Bank, Ltd. (1996) 42 Cal.App.4th 1647 (Mechanical Wholesale). A statute that limited an award of attorney fees to the prevailing party only to cases in which it is ultimately determined that there are in fact governing documents of a common interest development to be enforced would deny mutuality of remedy to the defendants in any instance, such as [1146] the present case, in which the plaintiffs would have obtained attorney fees had they prevailed in their claim, but the defendants would be denied attorney fees because they defeated the plaintiffs’ action by showing that no common interest development exists. Had the Legislature intended to deny equal treatment to the defendants in such a common circumstance, one would expect such an intent to be reflected in the legislative history of former section 1354(c). Nothing in the legislative history of the statute suggests, however, that the Legislature intended to deny attorney fees to the prevailing defendants in such an action and plaintiffs do not point to anything that would support such an intent.

As just noted, a long line of California decisions have interpreted other prevailing party attorney fee statutes to permit recovery of attorney fees by a prevailing defendant in situations analogous to the present case. Most of the relevant cases involve the interpretation and application of section 1717, subdivision (a), which provides that “[i]n any action on a contract” containing a provision authorizing one of the parties to the contract to recover attorney fees incurred to enforce the contract, the prevailing party “shall be entitled to reasonable attorney fees” “whether he or she is the party specified in the contract or not.”

Section 1717 was at issue in Hsu, supra, 9 Cal.4th 863, in which the plaintiffs, prospective purchasers of real property, brought suit against the defendant property owners, alleging that the defendants had breached a real estate sales contract that contained an attorney fee provision. The trial court found in favor of the defendants, concluding that the plaintiffs’ purported acceptance of the defendants’ offer was actually a counteroffer and that no contract had been formed. Although the defendants sought attorney fees under section 1717, the trial court denied their request and, on appeal, the Court of Appeal upheld that denial. (Hsu, supra, at pp. 869-870.)

On review, this court unanimously reversed the lower courts’ denial of attorney fees to the defendants. In the course of our opinion, we explained: “It is now settled that a party is entitled to attorney fees under section 1717 `even when the party prevails on grounds the contract is inapplicable, invalid, unenforceable or nonexistent, if the other party would have been entitled to attorney’s fees had it prevailed.'” . . . [¶] This rule serves to effectuate the purpose underlying section 1717. As this court explained, `[s]ection 1717 was enacted to establish mutuality of remedy where [a] contractual provision makes recovery of attorney’s fees available for only one party . . ., and to prevent oppressive use of one-sided attorney’s fees provisions. . . .’ . . . The statute would fall short of this goal of full mutuality of remedy if its benefits were denied to parties who defeat contract claims by proving that they were not parties to the alleged contract or that it was never formed. To achieve its [1147] goal, the statute generally must apply in favor of the party prevailing on a contract claim whenever that party would have been liable under the contract for attorney fees had the other party prevailed.” (Hsu, supra, 9 Cal.4th at pp. 870-871, citations omitted.) Hsu was decided in 1995, but several of the cases it cited, as well as other similar cases, predated the enactment of the prevailing party attorney fee provision at issue here. (See Bovard v. American Horse Enterprises, Inc. (1988) 201 Cal.App.3d 832, 842; North Associates v. Bell (1986) 184 Cal.App.3d 860, 865; Jones v. Drain (1983) 149 Cal.App.3d 484, 489-490; Care Constr., Inc. v. Century Convalescent Centers, Inc. (1976) 54 Cal.App.3d 701, 707.)

In Santisas, supra, 17 Cal.4th 599, we reaffirmed the rule set forth in Hsu, observing that a prevailing defendant is entitled to attorney fees under section 1717 “when a person sued on a contract containing a provision for attorney fees to the prevailing party defends the litigation `by successfully arguing the inapplicability, invalidity, unenforceability, or nonexistence of the same contract.’ . . . To ensure mutuality of remedy in this situation, it has been consistently held that when a party litigant prevails in an action on a contract by establishing that the contract is invalid, inapplicable, unenforceable, or nonexistent, section 1717 permits that party’s recovery of attorney fees whenever the opposing parties would have been entitled to attorney fees under the contract had they prevailed.” (Santisas, supra, 17 Cal. 4th at p. 611.)

The rule reiterated by this court in the Hsu and Santisas decisions was applied to a different prevailing party attorney fee provision in Mechanical Wholesale, supra, 42 Cal.App.4th 1647. In Mechanical Wholesale, the appellate court was called upon to interpret and apply former section 3176 (now section 8558), which provided that “`the prevailing party'” shall recover its attorney fees “`[i]n any action against . . . [a] construction lender to enforce . . . a bonded stop notice.'” (Mechanical Wholesale, supra, 42 Cal.App.4th at p. 1660.) In that case, a contractor sued a construction lender to enforce a bonded stop notice, and sought attorney fees under former section 3176. The defendant construction lender prevailed in the action by establishing that no bonded stop notice existed, and then sought attorney fees under former section 3176.

The Court of Appeal in Mechanical Wholesale rejected the plaintiff’s claim that because it had been determined that no bonded stop notice existed, the entire statutory scheme, including the related attorney fee provision, did not apply. The court in Mechanical Wholesale explained: “Here, there was `an action’ `against a construction lender’ on a `bonded stop notice’ in which the construction lender was clearly the `prevailing party.’ Under the statute, Fuji [1148] Bank [the construction lender] is entitled to its attorney fees. That plaintiff did not have a legal right to claim the benefit of the stop notice provisions is irrelevant. We need not be concerned as to why the stop notice claim was invalid; it is only necessary for Fuji Bank to have shown that it defeated the claim. Such invalidity will not bar fees to which a prevailing party is otherwise entitled.” (Mechanical Wholesale, supra, 42 Cal.App.4th at p. 1661, fn. omitted.) In the accompanying footnote, the Mechanical Wholesale court cited the analogous authority under section 1717. (Mechanical Wholesale, supra, at p. 1661, fn. 14.)

Plaintiffs in the present case do not deny that the action in this matter was brought to enforce what the complaint asserted were the governing documents of a common interest development, and that plaintiffs would have been entitled to recover attorney fees under former section 1354(c) had they prevailed in the lawsuit. Accordingly, under the rationale of the Hsu, Santisas, and Mechanical Wholesale decisions, it follows that defendants should be entitled to recover attorney fees under former section 1354(c) inasmuch as they were the prevailing party in the action.

Plaintiffs object to this conclusion on a number of theories, but, as we explain, none of the objections is meritorious.

First, plaintiffs argue that permitting a prevailing defendant to recover attorney fees under former section 1354(c) in this setting is inconsistent with the provisions of former section 1374, another provision of the CID Act, which provided that “[n]othing in this title [the CID Act] may be construed to apply to a development wherein there does not exist a common area as defined in subdivision (b) of Section 1351. [¶] This section is declaratory of existing law.” (As amended by Stats. 2005, ch. 37, § 3, p. 502.)^{[FN. 4]} The language of former section 1374, however, is apparently addressed to provisions of the CID Act that apply to “a development” not to “an action,” and is at least ambiguous regarding the effect, if any, that the statute would have on the proper interpretation of former section 1354(c). Looking beyond the statutory language, as defendants point out the legislative history of former section 1374 makes it clear that that provision was intended simply to protect residents of non-common-area subdivisions or community associations from being inadvertently subjected to the numerous obligations that the CID Act imposes upon common interest developments — including the election of a board of directors (former § 1363.03), the preparation and distribution of annual operating budgets (former §§ 1363, 1365), the levying of regular and [1149] special assessments (former § 1366), providing numerous notices to association members (former §§ 1365, subds. (e), (f), 1369.590, 1367.1, subd. (k), 1378, subd. (c)), complying with the Common Interest Development Open Meeting Act (former § 1363.05), and making accounting records, meeting minutes and other documents available for member inspections (former § 1363, subd. (e)). (See Sen. Rules Com., Off. of Sen. Floor Analyses, Analysis of Assem. Bill No. 67 (1993-1994 Reg. Sess.) as amended June 23, 1994, p. 2; Sen. Local Gov. Com., 3d reading analysis of Assem. Bill. No. 67 (1993-1994 Reg. Sess.), as amended Apr. 21, 1994, pp. 1-2.) Nothing in the legislative history of former section 1374 supports plaintiffs’ claim that the provision was intended or should be interpreted to affect the interpretation and application of the prevailing party attorney fee provision of former section 1354(c) or to undermine that provision’s reciprocal nature. Indeed, the purpose of former section 1374 — to protect the interests of homeowners who reside in non-common-interest developments § would clearly not be served by denying attorney fees to a defendant who prevails in a lawsuit by showing that, contrary to the plaintiff’s claim, the subdivision in question is not a common interest development.^{[FN. 5]}

Second, plaintiffs, like the Court of Appeal below, rely on the Court of Appeal decision in Mount Olympus, supra, 59 Cal.App.4th 885, but, as we shall explain, that decision does not support the denial of attorney fees to defendants in this case.

In Mount Olympus, supra, 59 Cal.App.4th 885, the underlying controversy arose over a home remodeling project that was proposed and begun by the defendant homeowners, the Shpirts. The home was located in a tract that was subject to a declaration of restrictions that had been recorded. The Shpirts’ next-door neighbor, Ross, objected to the remodeling and claimed it violated the declaration of restrictions, which required, among other matters, that any proposed remodeling be submitted to the Mount Olympus Property Owners Association (MOPOA) for approval. The Shpirts twice submitted plans to the MOPOA that were rejected. Their third submission was tentatively approved by the MOPOA, subject to a number of conditions that included submission of a final plan to the MOPOA and the Shpirts’ agreement to indemnify MOPOA should it be sued by Ross. The Shpirts did not fulfill the conditions but instead proceeded to demolish a portion of the existing home, allowed the property to fall into disrepair, and engaged in a pattern of abusive conduct interfering with Ross’s enjoyment of his property.

[1150] Thereafter, MOPOA and Ross brought the lawsuit at issue in Mount Olympusagainst the Shpirts, alleging multiple causes of action, including (1) breach of contract (for violation of the tract’s declaration of restrictions), (2) nuisance (for the accumulation of garbage on the property and the Shpirts’ abusive conduct), and (3) enforcement of an easement assertedly possessed by Ross to an unobstructed view to the south and west of the Ross property.

At the conclusion of the trial, the trial court found the Shpirts had violated the declaration of restrictions and had created a nuisance, and entered judgment in favor of Ross and the MOPOA. After the judgment was issued, Ross sought attorney fees from the Shpirts based on four separate grounds: (1) the attorney fee provision of the CID Act (then former § 1354, subd. (f), a statutory predecessor of former § 1354(c), the provision at issue in the present case), (2) the attorney fee provision contained in the declaration of restrictions, (3) an indemnity agreement assigning MOPOA’s right to attorney fees to Ross, and (4) Code of Civil Procedure former section 2033 (now Code Civ. Proc., § 2033.420), which permits a party to recover the expense (including attorney fees) of establishing the genuineness of a document when the losing party failed to admit the genuineness in response to a request for admission.

With regard to Ross’s attorney fee request, the trial court concluded (1) that Ross was entitled to recover fees under the attorney fee provision of the CID Act because the tract was a common interest development, (2) that Ross was not entitled to recover fees on his own behalf under the declaration of reservations because that document did not authorize attorney fees in a suit between homeowners, and (3) that by virtue of the indemnity agreement between Ross and MOPOA, Ross was entitled to recover the share of attorney fees that MOPOA was entitled to recover under the declaration of reservations. Because the trial court concluded that Ross was entitled to recover all of his own attorney fees under the attorney fee provision of the CID Act, it did not separately consider his request for a portion of his attorney fees as authorized by Code of Civil Procedure former section 2033.

The Court of Appeal in Mount Olympus affirmed the portion of the trial court’s posttrial order awarding MOPOA’s attorney fees to Ross under his indemnity agreement with MOPOA, but reversed the award to Ross of his own attorney fees under the attorney fee provision of the CID Act. On that point, the Court of Appeal concluded that, contrary to the trial court’s determination, the tract in which the Shpirts and Ross properties were located was not a common interest development within the meaning of the CID Act because there was not a common area owned by the individual property owners. Finally, because the trial court had not addressed Ross’s request for attorney fees under Code of Civil Procedure former section 2033 (concerning [1151] fees related to the Shpirts’ alleged failure to admit the genuineness of documents), the Court of Appeal remanded the case to the trial court for consideration of that issue. (Mount Olympus, supra, 59 Cal.App.4th at pp. 892-896.)

The Court of Appeal in the present case apparently viewed the Mount Olympus court’s decision with respect to the attorney fee provision of the CID Act as holding that whenever a trial court finds that a housing development is not a common interest development within the meaning of the CID Act, attorney fees are not recoverable under the attorney fee provision of that act. That understanding of the Mount Olympus decision, however, is mistaken. Because in Mount Olympus it was Ross who was seeking attorney fees under the attorney fee provision of the CID Act on the ground that the action was one to enforce the governing documents of an alleged common interest development, the Court of Appeal’s determination that the tract in question was not a common interest development meant that Ross was not the prevailing party in an action to enforce the governing documents of a common interest development. Although Ross was the prevailing party on other causes of action, insofar as the complaint purported to state a cause of action to enforce the governing documents of a common interest development, it was the defendants, the Shpirts, rather than the plaintiff Ross, who were the prevailing parties with respect to that cause of action.

In sum, the Mount Olympus opinion held that a plaintiff who sought attorney fees under the attorney fee provision of the CID Act was not entitled to an award of attorney fees under that statute when the plaintiff failed to establish that the tract was a common interest development, even when the plaintiff prevailed on other causes of action. The Mount Olympus decision, however, is not authority for denying a defendant, against whom an action to enforce the governing documents of a common interest development has been brought, the right to recover attorney fees under the statute when the defendant has prevailed in the action because the tract has been found not to be a common interest development. Unlike the plaintiff in Mount Olympus, defendants in the present case are the prevailing party in an action to enforce the governing documents of a common interest development.^{[FN. 6]}

In addition to relying on Mount Olympus, supra, 59 Cal.App.4th 885, plaintiffs rely on two other Court of Appeal decisions, but neither decision supports their position.

[1152] In Blue Lagoon Community Assn. v. Mitchell (1997) 55 Cal.App.4th 472 (Blue Lagoon), a majority of property owners in a common interest development voted to approve two amendments to the development’s declaration of restrictions, but the amendments did not receive the supermajority vote required by the applicable declaration of restrictions. The property owners favoring the amendments brought a petition in superior court utilizing a procedure authorized under former section 1356 (added by Stats. 1985, ch. 1003, § 1, p. 3222, now § 4275), permitting a court to reduce the percentage of affirmative votes necessary to amend a declaration of restrictions of a common interest development under specified circumstances. The proposed amendments were controversial within the development, however, and opposing homeowners hired an attorney and filed an objection to the petition. Following a contested hearing, the trial court denied the petition. Thereafter, the objecting homeowners sought an award of attorney fees, but the trial court denied the request.

On appeal, the Court of Appeal in Blue Lagoon affirmed the trial court’s determination, rejecting the objectors’ argument that they were entitled to attorney fees under former section 1354(c). The Court of Appeal explained: “Viewed objectively, the purpose of Civil Code section 1356 is to give a property owners’ association the ability to amend its governing documents when, because of voter apathy or other reasons, important amendments cannot be approved by the normal procedures authorized by the declaration. [Citation.] In essence, it provides the association with a safety valve for those situations where the need for a supermajority vote would hamstring the association. When the limited purpose of section 1356 is fully understood it is obvious that a petition brought under this section is not an adversarial proceeding. No defendants are named. No rights are sought to be protected. No wrongs are sought to be redressed. As such, it cannot be said that by opposing the petition the objectors were enforcing the governing documents and thus entitled to attorney fees and costs.” (Blue Lagoon, supra, 55 Cal.App.4th at p. 477.) Thus, unlike this case, in which plaintiffs clearly brought an action to enforce the governing documents of a common interest development, the court in Blue Lagoon concluded that neither the petition nor the objection in that proceeding constituted an action to enforce the governing documents of a common interest development within the meaning of former section 1354(c).^{[FN. 7]}

[1153] Plaintiffs additionally rely on the case of Gil v. Mansano (2004) 121 Cal.App.4th 739 (Gil), in support of their argument that an award of attorney fees is not authorized “where, as here, the statute is used defensively, and the language authorizing recovery of attorney’s fees is limited to `actions to enforce’. . . .” In Gil, the parties had entered into a release agreement that contained an attorney fee provision. One party brought suit against the other, alleging fraud, and the defendant responded by maintaining that the suit was barred by the release agreement. The trial court agreed with the defendant, entered judgment in its favor and awarded attorney fees to the defendant pursuant to the attorney fee provision of the release agreement.

The Court of Appeal in Gil, in a two-to-one decision, reversed the attorney fee award, interpreting the attorney fee provision in the release agreement, which authorized attorney fees when “action” was brought to enforce the agreement, to authorize such fees only when a party filed a lawsuit to enforce the release and not when a party proffered the release as a defense to a lawsuit. (Gil, supra, 121 Cal.App.4th at pp. 742-745.) One Court of Appeal justice dissented in Gil, maintaining that the majority had taken too narrow a view of the term “action” to enforce the release as used in the attorney fee provision in the release. (Id. at pp. 746-747 (dis. opn. of Armstrong, J.).) A subsequent Court of Appeal decision agreed with the dissenting justice in Gil on this point. (See Windsor Pacific LLC v. Samwood Co., Inc. (2013) 213 Cal.App.4th 263, 275-276.)

Without expressing any view on the merits of the Gil decision itself, we observe that, in any event, Gil provides no support for plaintiffs’ position here. Unlike the defendant in Gil, defendants in this case did not defend the action by claiming that the declaration of Tract 19051 was the governing document of a common interest development and by seeking to enforce the declaration as a defense to the action. Here, it was plaintiffs who filed an action to enforce the declaration as an asserted governing document of a common interest development. Thus, even under Gil, it is clear that the lawsuit here constituted an action to enforce the governing documents. Because defendants were the prevailing party in such an action, they are entitled to recover attorney fees under former section 1354(c).

[1154]

III. Conclusion

For the reasons discussed above, the judgment of the Court of Appeal is reversed insofar as it reversed the trial court’s attorney fee award in favor of defendants.

WERDEGAR, J., CHIN, J., CORRIGAN, J., LIU, J., CUÉLLAR, J. and KRUGER, J., concurs.

FN 1. In 2012, subsequent to all of the lower court proceedings in this matter, the CID Act was recodified. The former provisions of the Civil Code were repealed and reenacted as new sections of the Civil Code. (Stats. 2012, ch. 180, §§ 1-3, operative Jan. 1, 2014; see generally Recommendation: Statutory Clarification and Simplification of CID Law (Feb. 2011) 40 Cal. Law Revision Com. Rep. (2010) p. 235.) The specific provision at issue in this case — former section 1354, subdivision (c) — was repealed and reenacted without change as section 5975, subdivision (c).

Because the former provisions of the CID Act are cited in the lower court opinions and briefing in this matter, to minimize confusion this opinion generally will refer to the relevant provisions of the act by their former section numbers. Former section 1354, subdivision (c) — the specific statute at issue here — will generally be referred to as former section 1354(c).

In addition, unless otherwise specified, all statutory references are to the Civil Code.

FN 2. In addition to statutory attorney fee provisions, this court, relying upon its inherent equitable authority, has recognized three additional exceptions to the American Rule — the common fund, substantial benefit, and private attorney general doctrines — under which attorney fees may also be recovered. (See generally Serrano v. Priest(1977) 20 Cal.3d 25, 34-47.) The private attorney general attorney fee doctrine has subsequently been substantially codified in Code of Civil Procedure section 1021.5.

FN 3. The term “governing documents” as used in former section 1354(c) was defined in former section 1351, subdivision (j) (as amended by Stats. 2002, ch. 1111, § 1, pp. 7117-7118, now § 4150) to mean “the declaration and any other documents, such as bylaws, operating rules, articles of incorporation, or articles of association, which govern the operation of the common interest development or association.”

Former section 1354 read in full: “(a) The covenants and restrictions in the declaration shall be enforceable equitable servitudes, unless unreasonable, and shall inure to the benefit of and bind all owners of separate interests in the development. Unless the declaration states otherwise, these servitudes may be enforced by any owner of a separate interest or by the association, or by both.

“(b) A governing document other than the declaration may be enforced by the association against an owner of a separate interest or by an owner of a separate interest against the association.

“(c) In an action to enforce the governing documents, the prevailing party shall be awarded reasonable attorney’s fees and costs.” (§ 1354, as added by Stats. 2004, ch. 754, § 1, p. 5838.

FN 4. In the 2012 recodification of the CID Act, the substance of former section 1374 was reenacted as section 4201, which now provides: “Nothing in this act may be construed to apply to a real property development that does not contain common area. This section is declaratory of existing law.”

FN 5. In a similar vein, plaintiffs also rely on former section 1352 (now § 4200), which provides that “[t]his title applies and a common interest development is created” whenever specified conditions are satisfied. Former section 1352, however, predated the prevailing party attorney fee provision of former section 1354(c) (see Stats. 1985, ch. 874, § 14, p. 2777), and thus clearly was not intended and cannot properly be interpreted to limit the scope of the latter provision’s reciprocal effect.

FN 6. As noted above (ante, p. 6), the Court of Appeal in this case also cited a passage from a real property treatise to support its conclusion reversing the attorney fee award in favor of defendants. (See 12 Miller & Starr, Cal. Real Estate, supra, § 34:66, p. 34-229.) The passage in question, however, relies for authority solely upon the Mount Olympus decision (see 12 Miller & Starr, at p. 34-229, fn. 12), and thus provides no additional support for the Court of Appeal’s determination.

FN 7. Indeed, in a separate passage in the Blue Lagoon decision, the Court of Appeal clearly rejected the plaintiffs’ argument that the attorney fee provision of former section 1354 should not be read as intended to afford reciprocal attorney fee rights. In commenting on the potential consequences of the objectors’ position, the Blue Lagoon court observed: “This argument is shortsighted. In this case, the objectors `won.’ But what if the Association had `won’ and the petition had been granted? If we were to hold, as the objectors urge, that they are the prevailing party and thus entitled to attorney fees because they successfully beat back the majority’s efforts to amend the declaration, then is the Association entitled to its costs and fees against the objectors when they successfully bring a petition under Civil Code section 1356? If the objectors’ analysis were correct, the answer would have to be yes.” (Blue Lagoon, supra, 55 Cal.App.4th at pp. 477-478.)

Golden Gateway Center v. Golden Gateway Tenants Association

(2001) 111 Cal.Rptr.2d 336

[Freedom of Speech; Private Property] Actions of a private property owner constitute state action for purposes of California’s free speech clause only if the property is freely and openly accessible to the public.

Bartko, Zankel, Tarrant & Miller, Glenn P. Zwang and Howard L. Pearlman, San Francisco, for Plaintiff, Cross-defendant and Appellant.
James S. Burling, Sacramento, and Harold E. Johnson, for Pacific Legal Foundation as Amicus Curiae on behalf of Plaintiff, Cross-defendant and Appellant.
Edward J. Sack; Law Offices of Jo Anne M. Bernhard and Jo Anne M. Bernhard, Sacramento, for California Business Properties Association and International Council of Shopping Centers as Amici Curiae on behalf of Plaintiff, Cross-defendant and Appellant.
Pahl & Gosselin, Stephen D. Pahl and Karen M. Kubala, San Jose, for California Apartment Association as Amicus Curiae on behalf of Plaintiff, Cross-defendant and Appellant.
De Vries & Gold, Law Offices of Robert De Vries, Carolyn Gold and Robert De Vries, San Francisco, for Defendant, Cross-complainant and Respondent.
Jonathan P. Hiatt; Altshuler, Berzon, Nussbaum, Rubin & Demain and Scott A. Kronland, San Francisco, for American Federation of Labor and Congress of Industrial Organizations as Amicus Curiae on behalf of Defendant, Cross-complainant and Respondent.
Alan L. Schlosser, San Francisco; Morris D. Lipson; Chapman, Popik & White and Susan M. Popik, San Francisco, for American Civil Liberties Union of Northern California as Amicus Curiae on behalf of Defendant, Cross-complainant and Respondent.
Michael Somers, Gerald J. Van Gemert and James Arthur Judge, Tustin, for Association of Alternative Postal Systems, Inc., Los Angeles Newspaper Group, Advertising Consultants, Inc., CIPS Marketing Group, Inc., Turtle Ridge Media Group, Inc., and National Directory Company, Inc., as Amici Curiae on behalf of Defendant, Cross-complainant and Respondent.

BROWN, J.

In a groundbreaking decision over 20 years ago, we departed from the First Amendment jurisprudence of the United States Supreme Court and extended the reach of the free speech clause of the California Constitution to privately owned shopping centers. Robins v. Pruneyard Shopping Center (1979) 23 Cal.3d 899, 910, 153 Cal.Rptr. 854, 592 P.2d 341 (Robins), affd. sub nom. PruneYard Shopping Center v. Robins (1980) 447 U.S. 74, 100 S.Ct. 2035, 64 L.Ed.2d 741.) Since then, courts and commentators have struggled to construe Robins and determine the scope of protection provided by California’s free speech clause. Today, we clarify Robins and consider whether a tenants association has the right to distribute its newsletter in a privately owned apartment complex under article I, section 2, subdivision (a) of the California Constitution.^[FN.1] We conclude it does not.

Background

Golden Gateway Center (Golden Gateway), a limited partnership, owns a retail and residential apartment complex (Complex) in downtown San Francisco. The Complex consists of four high-rise buildings and a group of townhouses and contains 1,254 residential units. Although the Complex contains a number of retail establishments at the ground level, these retail establishments are separate from the residential [339] units and do not have access to the residential portions of the Complex.

In the residential portion of the Complex, Golden Gateway emphasizes privacy and security. Consistent with this emphasis, Golden Gateway provides doormen during the daytime and 24 hour roving security patrols, and limits access to residential tenants and their invitees. Golden Gateway also promulgates building standards incorporated by reference in every residential lease agreement. At all relevant times, these standards banned all solicitation in the building. As part of their lease agreements, all residential tenants agree to abide by these standards, and Golden Gateway retains the right to “make amendments to the Building Standards and adopt further Building Standards as in Owner’s opinion are reasonable or desirable for the proper and orderly care, use and operation of the Apartment and Building and its grounds. . . .”

In 1982, a group of residential tenants in the Complex formed a tenants association called the Golden Gateway Tenants Association (Tenants Association). Since its inception, the Tenants Association has periodically distributed a newsletter on or under the apartment doors of all residential tenants. For approximately 11 years, building management did not object to the distribution of these newsletters.

In 1993, however, the manager of the Complex asked the Tenants Association to stop distributing newsletters on or under apartment doors. In support, the manager cited the prohibition against “soliciting within the building” found in the building standards in effect at that time. The Tenants Association responded with several letters from attorneys asserting its constitutional right to free speech and threatening legal action. Hoping to avoid litigation, the manager told the Tenants Association that “Golden Gateway Center management will not oppose the distribution of newsletters under apartment doorways by members of the Golden Gateway Tenants’ Association provided it is done in a reasonable manner.” Based on this representation, the Tenants Association resumed its “practice of distributing GGTA newsletters to all tenants by sliding them under doors. . . .” Neither building management nor the Tenants Association, however, discussed or defined what “a reasonable manner” meant.

Golden Gateway hired a new building manager in 1995. In early 1996, the Tenants Association sharply increased its leafletting activity and distributed at least eight separate newsletters and notices from February to May. Because of this increased activity, the new manager asked the Tenants Association to scale back its leafletting and to limit its distributions to newsletters. Citing the First Amendment of the United States Constitution, the Tenants Association refused and continued to distribute its newsletter to all residential tenants.

Soon after, Golden Gateway revised its building standards. The revised standards stated in relevant part: “Any solicitation within the building is absolutely forbidden. This includes, for example, solicitation for profit, political purpose or any other reason, whether in writing or in person . . . . [¶] Leafleting within the building is absolutely forbidden. This includes, for example, posting leaflets or notices anywhere in the buildings other than on the bulletin boards located in the laundry rooms, sliding leaflets or other papers underneath tenants’ doors, placing leaflets or other papers on or about tenants’ doors, or leaving multiple copies of leaflets or other papers in any common areas. The only exception to this rule is where a tenant specifically requests that papers be delivered to him or her either under or in front [340] of his or her door. . . .” Golden Gateway mailed a copy of the new standards to each residential tenant and explained that each tenant must comply with these standards pursuant to his or her lease agreement.

Despite the new building standards, the Tenants Association continued to distribute its newsletter door-to-door. Golden Gateway then filed a complaint, seeking to enjoin the Tenants Association from distributing leaflets “in and around their apartment doors.” The Tenants Association responded by filing a cross-complaint for injunctive and declaratory relief. The cross-complaint contended, among other things, that the Tenants Association had a constitutional right to distribute its newsletters.

The trial court initially issued a preliminary injunction enjoining the Tenants Association from leafletting. After trial, however, the court dissolved the injunction and held that the Tenants Association had “a binding contractual right to distribute its newsletter throughout” the Complex “by placing its newsletters under the doors of all tenants, on the door knobs of tenants, and on bulletin boards that are provided.” Upon resolving the case on contractual grounds, the court declined to reach the constitutional free speech issues.

The Court of Appeal reversed. After concluding that Golden Gateway did not enter into “a binding lease agreement modifying its Building Standards” with the Tenants Association based on the first manager’s representation, the court held that the Tenants Association had no right to leaflet in the Complex under the United States or California Constitution.

We granted review to determine: (1) whether the tenants association of a large apartment complex has the right, under the California Constitution, to distribute its newsletter and other leaflets concerning residence in the complex to tenants in the building; and, if so, (2) whether a ban on the distribution of these materials to tenants constitutes an unreasonable time, place and manner restriction on free speech.

Discussion

In Hudgens v. National Labor Relations Bd. (1976) 424 U.S. 507, 519-520, 96 S.Ct. 1029, 47 L.Ed.2d 196 (Hudgens), the United States Supreme Court held that a union had no federal constitutional right to picket in a shopping center because the actions of the private owner of the shopping center did not constitute state action. Hudgens, supra, at pages 518-519, 96 S.Ct. 1029, expressly reversed Food Employees v. Logan Plaza (1968) 391 U.S. 308, 88 S.Ct. 1601, 20 L.Ed.2d 603 (Logan Plaza), by clarifying and extending the court’s ruling in Lloyd Corp., Ltd. v. Tanner (1972) 407 U.S. 551, 570, 92 S.Ct. 2219, 33 L.Ed.2d 131 (Lloyd) (holding that political leafletters had no federal free speech rights in a privately owned shopping mall). As acknowledged by both parties, Hudgens and Lloyd establish that the Tenants Association has no right to distribute its newsletter door-to-door under the United States Constitution. The lack of federal constitutional protection does not, however, “limit the authority of the State to exercise its police power or its sovereign right to adopt in its own Constitution individual liberties more expansive than those conferred by the Federal Constitution.” (PruneYard Shopping Center v. Robins, supra, 447 U.S. at p. 81, 100 S.Ct. 2035.) Thus, the Tenants Association may still prevail if the free speech clause of the California Constitution protects its leafetting activities. (Art. I, § 2, subd. (a).) As explained below, we conclude it does not.

[341] Article I, section 2, subdivision (a) states: “Every person may freely speak, write and publish his or her sentiments on all subjects, being responsible for the abuse of this right. A law may not restrain or abridge liberty of speech or press.” Unlike the United States Constitution, which couches the right to free speech as a limit on congressional power (see U.S. Const., 1st Amend.),^[FN.2] the California Constitution gives “[e]very person” an affirmative right to free speech (Cal. Const., art. I, § 2, subd. (a)). Accordingly, we have held that our free speech clause is “more definitive and inclusive than the First Amendment. . . .” (Wilson v. Superior Court (1975) 13 Cal.3d 652, 658, 119 Cal.Rptr. 468, 532 P.2d 116.)

Consistent with this more expansive interpretation of California’s free speech clause, we have declined to follow the First Amendment jurisprudence of the United States Supreme Court in certain circumstances. Perhaps our most noteworthy departure from this jurisprudence occurred in Robins. In Robins, the majority reversed Diamond v. Bland (1974) 11 Cal.3d 331, 113 Cal.Rptr. 468, 521 P.2d 460 (Diamond II), and held that “sections 2 and 3 of article I of the California Constitution protect speech and petitioning, reasonably exercised, in shopping centers even when the centers are privately owned.” (Robins, supra, 23 Cal.3d at p. 910, 153 Cal.Rptr. 854, 592 P.2d 341.) In doing so, the majority rejected the approach of Hudgens and Lloydand reasserted the independent force of the California Constitution.^[FN.3] (See Robins, at pp. 908-909, 153 Cal.Rptr. 854, 592 P.2d 341.)

Despite the clarity of its ultimate disposition, Robins was less than clear “as to the scope of the free speech rights it was recognizing.” (Brownstein & Hankins, Pruning Pruneyard: Limiting Free Speech Rights Under State Constitutions on the Property of Private Medical Clinics Providing Abortion Services (1991) 24 U.C. Davis L.Rev. 1073, 1090 (Pruning Pruneyard)) For example, Robins did not address the threshold issue of whether California’s free speech clause protects against only state action or also against private conduct. (See Laguna Publishing Co. v. Golden Rain Foundation(1982) 131 Cal.App.3d 816, 838, 182 Cal.Rptr. 813 (Laguna Publishing) [finding Robins “intriguing” because it never discussed or impliedly dealt with “the phenomenon of state action“].) Robins also provided little guidance on how to apply it outside the large shopping center context. (Pruning Pruneyard, supra, 24 U.C. Davis L.Rev. at p. 1092 [Robins did not provide “useful guidance on how this new constitutional journey was to proceed”].) Not surprisingly, numerous legal commentators have pointed out and questioned these curious omissions in Robins.^[FN.4] Moreover, most of [342] our sister courts interpreting state constitutional provisions similar in wording to California’s free speech provision have declined to followRobins.^[FN.5] Indeed, some [343] of these courts have been less than kind in their criticism of Robins. (See, e.g., SHAD Alliance, supra, 498 N.Y.S.2d 99, 488 N.E.2d at p. 1214, fn. 5; Jacobs, supra, 407 N.W.2d at p. 841.)

Nonetheless, Robins has been the law in California for over 20 years. Whether or not we would agree with Robins’s recognition of a state constitutional right to free speech in a privately owned shopping center if we were addressing the issue for the first time, we are obliged to follow it under principles of stare decisis. “`[E]ven in constitutional cases, the doctrine [of stare decisis] carries such persuasive force that we have always required a departure from precedent to be supported by some “special justification.”‘” (Dickerson v. United States (2000) 530 U.S. 428, 443, 120 S.Ct. 2326, 147 L.Ed.2d 405, quoting United States v. International Business Machines Corp. (1996) 517 U.S. 843, 856, 116 S.Ct. 1793, 135 L.Ed.2d 124.) Because Robins is embedded in our free speech jurisprudence with no apparent ill effects, no such justification exists here.

We are, however, mindful of the ambiguities in Robins. In the hopes of clarifying Robins and providing some guidance as to the scope of the free speech rights guaranteed by the California Constitution, we now answer some of the questions left open by Robins. Based on these answers, we hold that the Tenants Association has no state constitutional right to leaflet in the Complex.

“[B]efore state courts can fully resolve . . . substantive free speech . . . issues, a proper constitutional analysis requires that they first address the threshold issue of whether the . . . suits are barred by a state action requirement.” (Note, Post Pruneyard Access to Michigan Shopping Centers: The “Mailing” of Constitutional Rights (1983) 30 Wayne L.Rev. 93, 97, fn. omitted (Post Pruneyard Access); see also Private Property, Public Property, supra, 62 Alb. L.Rev. at p. 1239 [state action question should be “a threshold issue” in any analysis of constitutional free speech rights].) Thus, by neglecting to mention state action, Robins created a noticeable gap in its reasoning and left the existence of a state action limitation on California’s free speech clause in doubt. (California’s Right to Privacy, supra, 19 Pepperdine L.Rev. at p. 413; Free Speech Access to Shopping Centers, supra, 68 Cal. L.Rev. at p. 645.) Indeed, our lower courts have commented on this “intriguing” Omission. (Laguna Publishing, supra, 131 Cal.App.3d at p. 838, 182 Cal. Rptr. 813.) Not surprisingly, the uncertainty surrounding the fate of the state action limitation has spawned a debate over the wisdom of extending our free speech clause to private actors.^[FN.6] We now [344] fill this gap and conclude that California’s free speech clause contains a state action limitation.

As an initial matter, we note that the first sentence of article I, section 2, subdivision (a) contains no explicit state action limitation. The California Constitution gives every person the right to “freely speak, write and publish his or her sentiments on all subjects, being responsible for the abuse of this right.” (Art. I, § 2, subd. (a).) The breadth of this language combined with the framers’ arguable understanding of its ramifications suggest an intent to protect the right to free speech against private intrusions. (Private Actors, supra, 17 Hastings Const. L.Q. at pp. 119-121.) The express prohibition against a “law” restraining or abridging free speech found in the second sentence of the clause arguably bolsters such an interpretation. (Art. I, § 2, subd. (a).)

Nonetheless, the absence of an explicit state action limitation in article I, section 2, subdivision (a) is not dispositive. In the past, we have found a state action requirement even though the language of the California constitutional provision in question-article I, section 7—did not expressly state such a requirement. (Gay Law Students Assn. v. Pacific Tel. & Tel. Co. (1979) 24 Cal.3d 458, 468, 156 Cal.Rptr. 14, 595 P.2d 592 (Gay Law Students Assn.); see also Jones v. Kmart Corp. (1998) 17 Cal.4th 329, 333, 70 Cal.Rptr.2d 844, 949 P.2d 941 [stating that the search and seizure provision of the California Constitution—article I, section 13—contains a state action limitation even though the provision contains no such limiting language].) We declined to apply that provision “without regard to any state action doctrine whatsoever” absent some “suggestion” in the provision’s history for abandoning such a limitation. (Gay Law Students Assn., at p. 468, 156 Cal.Rptr. 14, 595 P.2d 592.) Thus, “[t]he omission [of state action language] . . . does not necessarily evince an intent to apply constitutional guarantees to private parties.” (Margulies, A Terrible Beauty: Functional State Action Analysis and State Constitutions (1988) 9 Whittier L.Rev. 723, 729 (A Terrible Beauty).)

Moreover, the language of article I, section 2, subdivision (a) equally supports a state action limitation. The second sentence of the clause—which prohibits any “law” from restraining or abridging “liberty of speech” (ibid.)—indicates an intent to protect against only state actions. “Adding this prohibition on oppressive laws might mean that, although the delegates wished to declare generally the sanctity of free expression, they feared only government intrusions.” (Private Actors, supra, 17 Hastings Const. L.Q. at p. 121.) Such a reading is consistent with the view courts take of the Fourth Amendment, which is similar in structure to California’s free speech clause. (Ibid.)

Thus, as acknowledged by the primary scholar cited by the dissent, the language of California’s free speech clause is ambiguous and supports either the presence or absence of a state action limitation. (Private Actors, supra, 17 Hastings Const. L.Q. at p. 125 [“The text does not compel a finding that private parties are bound; it only creates an opportunity to do so”]; see [345] id. at p. 121; see also A Terrible Beauty, supra, 9 Whittier L.Rev. at p. 729.) Where, as here, the text is “not conclusive” (Private Actors, supra, 17 Hastings Const. L.Q. at p. 121), we must look to the history behind California’s free speech clause for guidance (see Hill v. National Collegiate Athletic Assn. (1994) 7 Cal.4th 1, 16, 26 Cal.Rptr.2d 834, 865 P.2d 633 (Hill)). This history indicates that the framers intended to impose a state action requirement. (See Gay Law Students Assn., supra, 24 Cal.3d at p. 468, 156 Cal.Rptr. 14, 595 P.2d 592 [finding a state action limitation based on the history behind the due process and equal protection clauses of the California Constitution].)

We initially note that the debates over the California Constitution do not show an intent to extend the reach of its free speech clause to private actors. Although “the designation of article I’s free speech clause has changed appreciably over the years . . . its language has not.” (Gerawan, supra, 2A Cal.4th at p. 489, 101 Cal. Rptr.2d 470, 12 P.3d 720.) Thus, the current incarnation of California’s free speech clause is virtually identical to the free speech clause in the original California Constitution adopted in 1849. (Compare Cal. Const., art. I, § 2, subd. (a), with Cal. Const, of 1849, art. I, § 9.) The original framers adopted this language with no debate. (See Browne, Rep. of Debates in Convention of Cal. on Formation of State Const. (1973 ed.) p. 41 (Browne); see also Private Actors, supra, 17 Hastings Const. L.Q. at p. 119.) In fact, “[t]he debates, which on other provisions are quite detailed, contain no record of any `original intent’ of these delegates in regard to the private/public distinction.” (Private Actors, supra, 17 Hastings Const. L.Q. at p. 119.) Thus, the debates over California’s free speech clause give no indication that the framers wished to guard against private infringements on speech.

Meanwhile, the historical antecedents of our free speech clause strongly suggest that the framers of the California Constitution intended to include a state action limitation. Many of the framers of the 1849 California Constitution came from New York. (See Browne, supra, at pp. 478-479.) Not surprisingly, in drafting the free speech clause, the framers borrowed from the free speech clause of the New York Constitution. (Browne, supra, at p. 31.) Because they adopted New York’s free speech clause virtually unchanged and with no debate (Private Actors, supra, 17 Hastings Const. L.Q. at p. 119), the history behind New York’s clause is relevant to interpreting California’s free speech clause (see Citizens for Parental Rights v. San Mateo County. Bd. of Education (1975) 51 Cal.App.3d 1, 25-26, fn. 26, 124 Cal.Rptr. 68 [finding the history behind the New York Constitution relevant to interpreting a clause of the California Constitution based on a clause in the New York Constitution]).

A review of this history reveals that the framers of the New York Constitution intended its free speech clause “to serve as a check on governmental, not private, conduct.” (SHAD Alliance, supra, 498 N.Y.S.2d 99, 488 N.E.2d at p. 1214.) The free speech clause of the New York Constitution was adopted in 1821 as part of that Constitution’s Bill of Rights and remained essentially unchanged after New York revised its Constitution in 1846.^[FN.7^][346] “The explicit reason [behind the adoption of New York’s free speech clause] was to prevent the legislature from restricting these freedoms by statute.” (Galie, The New York State Constitution (1991) p. 51, fn. omitted.) As one of the delegates to New York’s 1821 constitutional convention explained, the free speech clause “was doubtless intended to secure the citizens . . . against the arbitrary acts of the legislature . . . .” (Carter & Stone, Reports of the Proceedings and Debates of the Convention of 1821 (1821) p. 167 (Reports of the Proceedings).) In addition, the delegates to the 1821 New York constitutional convention viewed the free speech clause as protection against the “usurpations by our judiciary” of libel actions from the jury. (Id. at p. 490; see also id. at p. 167.) The framers of New York’s free speech clause, however, were not concerned with private interference with speech. “[W]hile most of the delegates were eager to defend the public’s rights against official or legal interference, they were unwilling to countenance unlimited freedom of expression . . . .” (Casias, The New York State Constitutional Convention of 1821 and its Aftermath (Colum.U.1967) p. 139.)

Indeed, the framers of the 1821 New York Constitution viewed the Constitution’s Bill of Rights, including its free speech clause, as a bulwark against government oppression, not private conduct. (See Reports of the Proceedings, supra, at pp. 59, 163, 171-172.) As one delegate explained, “[a] bill of rights setting forth the fundamental provisions of our government, has always been held sacred, and I have seen, as other gentlemen familiar with legislation must have seen, the utility of this bill of rights . . . one calculated to restrain useless and improvident legislation.” (Id. at p. 163.) Another delegate later reiterated this understanding: “[A] bill [of rights] like this reported, is not a bill enumerating the rights of the people, but restricting the power of the legislature.” (Id. at p. 172.) According to this same delegate, a “bill of rights, setting forth the privileges of the people would be useless, nay, might be injurious; because in purporting to set forth the rights of the people, if any were omitted, they might be considered to be yielded.” (Ibid.)

This elucidation of the intent behind New York’s free speech clause also conforms with the framers’ understanding of the overarching purpose behind the 1821 New York Constitution. “The intent of the constitution that we are framing, and of every constitution, is to distribute to these [government] agents the power thus derived from the people:—to mark the limits of their authority, and provide the means of restraining them in its exercise, within their appropriate sphere.” (Reports of the Proceedings,supra, at p. 110.)

Pre-1849 judicial statements regarding the scope of New York’s free speech clause further confirm that the framers of the New York Constitution intended to protect against only government encroachments. As the Chancery Court of New York observed, “[t]hat great principle of a free government] the liberty of speech and of the press, is very wisely guarded by a constitutional provision against the encroachment of either legislation or judicial power.” (Wetmore v. Scovell (N.Y.Ch. 1842) 3 Edw. Ch. 543, 562, italics added.)

Thus, the framers of the New York Constitution undoubtedly intended that New York’s free speech clause protect against only state action—and not private conduct. Because the framers of the California Constitution adopted New York’s free speech [347] clause almost verbatim, we reasonably conclude they had the same intent as their New York counterparts. (Cf. Stockton Civic Theatre v. Board of Supervisors (1967) 66 Cal.2d 13, 21, 56 Cal.Rptr. 658, 423 P.2d 810 [finding that statutory language taken verbatim from a constitutional provision must be given the same meaning as the language in the constitutional provision “unless a clear legislative intent to the contrary appears”].)

This conclusion follows logically from the mindset of the framers of the 1849 California Constitution during its drafting. General Bennett Riley issued the call for the 1849 convention “for the purpose of providing such a government as California might need.” (Coy & Jones, California’s Constitution (1930) p. 12; see also Browne, supra,at pp. 3-4.) Thus, the framers of the 1849 California Constitution were focused on defining the scope of the government’s power. Consistent with this focus, various delegates observed that the Constitution should protect against governmental action. (See, e.g., Browne, supra, at pp. 92, 130 [“the object of this Convention is to limit the powers of the Legislature”; “We are guarding here against bad Legislatures”].) As a result, the California “Constitution of 1849 was not a grant of power to the Legislature but a limitation upon it.” (Conmy, The Constitutional Beginnings of California (1959) p. 23, fn. 48, italics added.) “It is abundantly clear that the draftsmen of the 1849 and 1879 constitutions regarded the California Constitution as the principal bulwark protecting the liberties of Californians from governmental encroachment.” (Grodin et al., The Cal. State Constitution (1993) p. 21, italics added.)

In any event, our extensive review of the history behind the adoption of California’s free speech clause reveals no evidence suggesting that the framers intended to protect against private encroachments. The lack of such evidence is hardly surprising given the prevailing perception of state constitutions in 1849, as expounded by the United States Supreme Court: “Each state established a constitution for itself, and in that constitution, provided such limitations and restrictions on the powers of its particular government, as its judgment dictated.” (Barron v. City Council of Baltimore (1833) 32 U.S. (7 Pet.) 243, 247, 8 L.Ed. 672,italics added.) Indeed, “common law and civil law” historically “regulate[d] private conduct,” while constitutional law regulated “public or governmental conduct.” (California’s Right to Privacy, supra, 19 Pepperdine L.Rev. at p. 409, italics added.) Thus, “[i]t would . . . be natural to expect that a declaration of rights contained in a state constitution pertains primarily to restrictions upon what the state may do to its citizens.” (Id. at p. 407, fn. omitted.) Based on the historical evidence suggesting that the framers of California’s free speech clause intended to protect against governmental—and not private— encroachments, and the absence of any evidence to the contrary, we see no grounds for reaching a different conclusion. (See Gay Law Students Assn., supra, 24 Cal.3d at p. 468, 156 Cal.Rptr. 14, 595 P.2d 592.)

Robins does not alter our conclusion. Contrary to the dissent’s unsupported assertion, Robins did not necessarily reject a state action limitation. It could have “simply broadened the federal definition of `state action’ to embrace the peculiar facts of the case.” (Constructing an Alternative, supra, 21 Rutgers L.J. at p. 832.) Over the past 20 years, numerous commentators have explicitly and implicitly recognized such a possibility and noted that Robins left open the issue of whether [348] California’s free speech clause required state action.^[FN.8]

Indeed, our refusal to abandon the state action requirement is fully consonant with Robins. Although Robins did not address the state action issue, it did rely heavily on California cases applying the pre-Lloyd decisions of the United States Supreme Court (Robins, supra, 23 Cal.3d at pp. 908-909, 153 Cal.Rptr. 854, 592 P.2d 341)—which, as Robins itself recognized, imposed a state action requirement (id. at p. 904,153 Cal.Rptr. 854, 592 P.2d 341). Moreover, the reasoning of Robins bears a “close similarity” to the reasoning of the United States Supreme Court in Logan Valley. (Pruneyard Shopping Center, supra, 57 Chi.-Kent L.Rev. at p. 389.) Finally, Diamond v. Bland (1970) 3 Cal.3d 653, 666, fn. 4, 91 Cal.Rptr. 501, 477 P.2d 733 (Diamond I), one of the decisions cited as persuasive authority in Robins, expressly acknowledged the need for state action in order to trigger constitutional free speech protections. Thus, Robins is wholly consistent with a state action requirement. (SeeCalifornia’s Right to Privacy, supra, 19 Pepperdine L.Rev. at p. 413; Free Speech Access to Shopping Centers, supra, 68 Cal. L.Rev. at p. 665.)

Our recent statement in Gerawan that California’s free speech clause “runs against the world, including private parties as well as governmental actors” does not dictate a contrary result. (Gerawan, supra, 24 Cal.4th at p. 492, 101 Cal.Rptr.2d 470, 12 P.3d 720.) In Gerawan, we considered “whether a marketing order issued by the Secretary of Food and Agriculture of the State of California implicates any right to freedom of speech under either the First Amendment or article I by compelling funding of generic advertising.” (Id. at p. 476, 101 Cal.Rptr.2d 470, 12 P.3d 720.) Because the presence of a state actor was undisputed, we did not carefully consider whether California’s free speech clause requires state action. Therefore, the language in Gerawan suggesting that our free speech clause protects against private action is nonbinding dictum. (See Santisas v. Goodin (1998) 17 Cal.4th 599, 620, 71 Cal.Rptr.2d 830, 951 P.2d 399 [A decision “is not authority for everything said in the . . . opinion but only `for the points actually involved and actually decided'”].) The absence of any analysis renders this dictum unpersuasive. (See People v. Mendoza(2000) 23 Cal.4th 896, 915, 98 Cal.Rptr.2d 431, 4 P.3d 265 [“`we must view with caution seemingly categorical directives not essential to earlier decisions and be guided by this dictum only to the extent it remains analytically persuasive'”].) In any event, the express repudiation of this language by one of the four signatories to Gerawan removes any impediment to reaching a different conclusion based on our careful consideration of the clause’s text and history here.

Nor does our decision in Hill to reject a state action limitation on California’s privacy clause compel a different result. Our decision in Hill was based solely on the official ballot pamphlet—which clearly contemplated that the constitutional right to privacy “may be enforced against private parties. . . .” (Hill, supra, 7 Cal.4th at p. 18, 26 Cal.Rptr.2d 834, 865 P.2d 633; see id at pp. 16-18, 19, 26 Cal.Rptr.2d 834, [349] 865 P.2d 633.) In contrast, the history behind California’s free speech clause contains no such indication and strongly suggests the contrary. (See ante, 111 Cal. Rptr.2d at pp. 344-347, 29 P.3d at pp. 803-806.)

Likewise, the existence of a clause in the 1849 Constitution granting wives a separate property right against their husbands does not support the rejection of a state action limitation. (Cal. Const, of 1849, art. XI, § 14.) Unlike the free speech clause, section 14 of article XI was not part of the Declaration of Rights—which historically set forth general principles of governance and established limitations on governments, not private individuals. (See California’s Right to Privacy, supra, 19 Pepperdine L.Rev. at p. 407.) Because the marital property rights provision is more analogous to particularized legislation, literal adherence to the words of that provision may be sufficient. However, where, as here, the constitutional provision announces a broad principle of government, we necessarily look beyond the text and consider the context and history of that provision. (See, e.g., Gay Law Students Assn., supra, 2ACal.3d at pp. 468-469, 156 Cal.Rptr. 14, 595 P.2d 592; Kruger v. Wells Fargo Bank(1974) 11 Cal.3d 352, 366-367, 113 Cal.Rptr. 449, 521 P.2d 441.) Thus, the existence of the marital property rights provision does not make irrelevant the fact that California’s free speech clause derives almost verbatim from a clause in the New York Constitution with a state action limitation. (See ante, 111 Cal. Rptr.2d at pp. 345-346, 29 P.3d at pp. 805-806.)

Finally, including a state action limitation comports with the decisions of most of our sister courts. (See State Constitutions and Protection of Freedom of Expression, supra, 33 U.Kan. L.Rev. at p. 318 [“The notion that free expression can, and potentially does, mean something slightly different in each state even when provisions read identically is not fully supportable”].) Virtually every state court construing a state constitutional provision with language similar to California’s free speech provision has found a state action requirement.^[FN.9] Although their reasoning varies somewhat, they all explicitly or implicitly invoke the venerable principle that “[s]tate constitutions . . . serve as limitations on the otherwise plenary power of state governments.” (Woodland, supra, 378 N.W.2d at p. 347.) Under this principle, “the fundamental nature of a constitution is to govern the relationship between the people and their government, not to control the rights of the people vis-a-vis each other.” (Southcenter Joint Venture, supra, 780 P.2d at p. 1286, fn. omitted.)

Like our sister courts, we recognize that this careful differentiation between government and private conduct has been a hallmark of American constitutional theory [350] since the birth of our nation and serves two important purposes. First, this demarcation is necessary to preserve private autonomy. “[B]y exempting private action from the reach of the Constitution’s prohibitions, [the state action limitation] stops the Constitution short of preempting individual liberty—of denying to individuals the freedom to make certain choices. . . . Such freedom is basic under any conception of liberty, but it would be lost if individuals had to conform their conduct to the Constitution’s demands.” (Tribe, American Constitutional Law (2d ed.1988) p. 1691.)

Second, a state action Umitation safeguards the separation of powers embodied in every American constitution by recognizing the limited ability of courts “to accomplish goals which are essentially legislative and political.” (Woodland, supra, 378 N.W.2d at p. 347.) “Without a state action limitation, the courts will possess the same authority as the legislature to limit individual freedoms, but will lack the degree of accountability which should accompany such power.” (Postr-Pruneyard Access, supra, 30 Wayne L.Rev. at p. 117.) As a result, absent a state action requirement, “the `rule of law* would approach in Sir Ivor Jennings’ caustic but realistic phrase, `rule by the judges alone.'” (Harvey, Private Restraint of Expressive Freedom: A Postr-Pruneyard Assessment (1989) 69 B.U. L.Rev. 929, 967, fn. omitted (Private Restraint).) Indeed, “[i]t is not the role of [courts] to strike precise balances among the fluctuating interests of competing private groups which then become rigidified in the granite of constitutional adjudication.” (Cologne, supra, 469 A.2d at p. 1210.)

Neither the text of California’s free speech clause nor our case law reveals an intent to depart from these bedrock principles of constitutional jurisprudence. At the same time, the history behind the clause supports the inclusion of a state action limitation and contains nothing even suggesting a contrary possibility. Accordingly, we hold that article I, section 2, subdivision (a) only protects against state action.^[FN.10] (See Gay Law Students Assn., supra, 24 Cal.3d at p. 468, 156 Cal.Rptr. 14, 595 P.2d 592.)

III

Of course, finding a state action limitation does not end our inquiry. We must still determine the scope of this limitation. Robins established that state action for purposes of California’s free speech clause is not the same as state action for purposes of the First Amendment. (See Robins, supra, 23 Cal.3d at pp. 905-906, 153 Cal.Rptr. 854, 592 P.2d 341 [federal free speech decisions do not preclude a different result under the California Constitution].) In particular, California’s free speech clause, unlike its federal counterpart, runs against certain privately owned shopping centers. (Compare Robins, supra, 23 Cal.3d at p. 910, 153 Cal.Rptr. 854, 592 P.2d 341, with Hudgens, supra, 424 U.S. at pp. 519-520, 96 S.Ct. 1029.) Robins did not, however, define the requisite state action or delineate the scope of free speech rights recognized by the California Constitution. Today, we take the first step in rectifying this situation and conclude that no state action exists here because the Complex is not freely open to the public.

[351] Although Robins did not mention state action and did not clearly define the scope of California’s free speech clause, we can still look to its reasoning for guidance. To support its holding that the California Constitution protects free speech in a privately owned shopping center, Robins relied heavily on the functional equivalence of the shopping center to a traditional public forum—the “`”downtown[ ]”‘” or “central business district[ ].” (Robins, supra, 23 Cal.3d at pp. 910, fn. 5, 907, 153 Cal.Rptr. 854, 592 P.2d 341; id. at pp. 910-911, 153 Cal.Rptr. 854, 592 P.2d 341.) In finding this functional equivalence, Robins emphasized, among other things, the shopping center’s open and unrestricted invitation to the public to congregate freely. (See id. at pp. 909-910, 153 Cal.Rptr. 854, 592 P.2d 341.) Indeed, Robins implicitly exempted “`an individual homeowner'” from the purview of California’s free speech clause, presumably because individual homes are not freely and openly accessible to the public. (Id. at p. 910, 153 Cal.Rptr. 854, 592 P.2d 341.) In doing so, Robins indicated that the applicability of California’s free speech clause depends in part on the public character of the property.

The importance of the public character of the property in determining the scope of California’s free speech clause derives support from Robins‘s reference to earlier California decisions finding a right to free speech on private property. Although all of these cases relied on the First Amendment and the pre-Lloyd decisions of the United States Supreme Court—Marsh v. Alabama (1946) 326 U.S. 501, 66 S.Ct. 276, 90 L.Ed. 265 (Marsh) and Logan Valley, supra, 391 U.S. 308, 88 S.Ct. 1601, 20 L.Ed.2d 603^[FN.11] Robins found many of the principles enunciated in these cases persuasive in interpreting California’s free speech clause. (See Robins, supra, 23 Cal.3d at pp. 908-909, 153 Cal.Rptr. 854, 592 P.2d 341.) One such principle emphasized byRobins was the public’s unrestricted access to the privately owned property.^[FN.12] (SeeRobins, at pp. 909-910, 153 Cal.Rptr. 854, 592 P.2d 341.)

Indeed, the reference in Robins to California cases relying on Marsh and Logan Valley suggests an implicit approval of the reasoning in these federal decisions. (SeePruneyard Shopping Center, supra, 57 Chi.-Kent L.Rev. at p. 384 [noting that Robins“resurrect[ed] the rationale of Logan Valley“].) Because both Marsh and Logan Valleypartially relied on the public’s unrestricted access in extending the reach of the First Amendment to certain Privately owned properties, they bolster the conclusion that private property [352] must be public in character before California’s free speech clause may apply. For example, Marsh held that a sidewalk in the business district of a privately owned town may be treated as publicly owned property for First Amendment purposes based, in part, on the public’s unrestricted access to the town’s business district. Marsh, supra, 326 U.S. at pp. 508-509, 66 S.Ct. 276.) “The more an owner, for his advantage, opens up his property for use by the public in general, the more do his rights become circumscribed by the statutory and constitutional rights of those who use it.” (Id at p. 506, 66 S.Ct. 276.) Similarly, Logan Valley held that a shopping mall should be treated as publicly owned for First Amendment purposes because, among other things, the public had “unrestricted access to the mall property.” (Logan Valley, supra, 391 U.S. at pp. 318, 321, 325, 88 S.Ct. 1601.)

In light of the above, we conclude that the actions of a private property owner constitute state action for purposes of California’s free speech clause only if the property is freely and openly accessible to the public. By establishing this threshold requirement for establishing state action, we largely follow the Court of Appeal decisions construing Robins. For example, our Courts of Appeal have consistently held that privately owned medical centers and their parking lots are not functionally equivalent to a traditional public forum for purposes of California’s free speech clause because, among other things, they are not freely open to the public. (See, e.g.,Feminist Women’s Health Center v. Blythe (1995) 32 Cal.App.4th 1641, 1661, 39 Cal. Rptr.2d 189 (Blythe); Allred v. Harris (1993) 14 Cal.App.4th 1386, 1392-1393, 18 Cal.Rptr.2d 530; Planned Parenthood v. Wilson (1991) 234 Cal.App.3d 1662, 1672, 286 Cal.Rptr. 427; Allred v. Shawley (1991) 232 Cal.App.3d 1489, 1504-1505, 284 Cal.Rptr. 140.) Our lower courts have also suggested that an apartment complex does not resemble a traditional public forum because it “is a place where the public is generally excluded.” (Cox Cable San Diego, Inc. v. Bookspan (1987) 195 Cal.App.3d 22, 29, 240 Cal.Rptr. 407.)

Here, the Complex is privately owned, and Golden Gateway, the owner, restricts the public’s access to the Complex. In fact, Golden Gateway carefully limits access to residential tenants and their invitees. Thus, the Complex, unlike the shopping center in Robins, is not the functional equivalent of a traditional public forum. Accordingly, Golden Gateway’s actions do not constitute state action for purposes of California’s free speech, and the Tenants Association has no right to distribute its newsletter pursuant to article I, section 2, subdivision (a).^[FN.13]

In reaching this conclusion, we note that judicial enforcement of injunctive relief does not, by itself, constitute state action for purposes of California’s free speech clause. Although the United States Supreme Court has held that judicial effectuation of a racially restrictive covenant constitutes state action (see Shelley v. Kraemer (1948) 334 U.S. 1, 20, 68 S.Ct. 836, 92 L.Ed. 1161), it has largely limited this holding to the facts of those cases (Cole, Federal and State “State Action”: The Undercritical Embrace of a Hypercriticized Doctrine (1990) 24 Ga. L.Rev. 327, 353). We therefore decline to extend it to this particular case, where the private property owner merely seeks judicial enforcement of a neutral lease provision.^[FN.14^][353] Indeed, a contrary holding would effectively eviscerate the state action requirement because private property owners, for the most part, enforce their property rights through court actions. We also see no basis for conditioning a finding of state action on whether a party invokes California’s free speech clause as a sword or a shield. Therefore, we decline to follow the dictum in Blythe, supra, 32 Cal. App.4th at page 1665, 39 Cal.Rptr.2d 189 [“Free speech concerns may be raised as a shield against injunctive relief only because the effectuation of such relief entails government action”].

Martin v. City of Struthers (1943) 319 U.S. 141, 63 S.Ct. 862, 87 L.Ed. 1313 and Van Nuys Pub. Co. v. City of Thousand Oaks (1971) 5 Cal.3d 817, 97 Cal.Rptr. 777, 489 P.2d 809 are also inapposite. Although Martin and Van Nuys found the prohibition of door-to-door leafletting to private residences unconstitutional, both cases involved municipal ordinances enacted by a governmental entity. (Martin, at p. 142, 63 S.Ct. 862; Van Nuys, at p. 819, 97 Cal.Rptr. 777, 489 P.2d 809.) Here, the owner of the Complex is a private entity, and its actions do not constitute state action. (See ante,111 Cal.Rptr.2d at p. 352, 29 P.3d at p. 810.)

Likewise, defendant’s reliance on Inganamort v. Merker (Ch.Div.1977) 148 N.J.Super. 506, 372 A.2d 1168 is misplaced. Inganamort only held that tenants had the right to distribute noncommercial written material in an apartment building pursuant to their leaseholds under New Jersey law. (Id. at p. 1170.) It did not consider any constitutional right to free speech. Moreover, the New Jersey Supreme Court has declined to impose a state action limitation on the free speech clause of New Jersey’s Constitution. (New Jersey Coalition Against War, supra, 650 A.2d at p. 771.) Therefore, New Jersey decisions are not relevant to our interpretation of the California Constitution.

Finally, Laguna Publishing, supra, 131 Cal.App.3d 816, 182 Cal.Rptr. 813, is distinguishable. In Laguna Publishing, the Court of Appeal found the discriminatory enforcement of a ban on distributing commercial newspapers in a private, gated community unconstitutional. (Id. at p. 844, 182 Cal.Rptr. 813.) In contrast, the instant case does not involve a discriminatory limitation on speech activities. Because this case does not raise the same issue raised in Laguna Publishing, we decline to address it here and leave its resolution for another day.

In closing, we emphasize that our decision today does not give apartment owners carte blanche to stifle tenant speech. Tenants may still have remedies under conventional property law principles. (See Lobsenz & Swanson, The Residential Tenant’s [354] Right to Freedom of Political Expression (1986) 10 U. Puget Sound L.Rev. 1, 45.) Moreover, many statutes and ordinances serve to protect tenants against unreasonable lease provisions and restrictions. (See, e.g., Civ.Code, §§ 1942.5, 1942.6, 1953.) Finally, tenants may always seek a legislative solution tailored to their particular concerns. Indeed, “[t]he common law and statutes are always sufficient if a state court has the desire and will to protect private rights from private infringement.” (California’s Right to Privacy, supra, 19 Pepperdine L.Rev. at p. 409.) Our decision today merely seeks to avoid “rigid rectitude in stultifying, imposed uniformity” by dechning to constitutionalize a private dispute. (Private Restraint, supra, 69 B.U. L.Rev. at p. 969.)

Disposition

We affirm the judgment of the Court of Appeal.

BAXTER, J., and CHIN, J., concur.

Concurring Opinion by GEORGE, C.J.

I concur in the determination that article I, section 2, subdivision (a) of the California Constitution (section 2(a) or the free speech clause) does not afford defendant tenants association a right to distribute unsolicited pamphlets in the interior hallways of privately owned apartment buildings from which the general public is excluded.

As I shall explain, the particular category of free speech claim here at issue—the right to distribute unsolicited pamphlets on another’s property—is applicable only with respect to locations that, whether publicly or privately owned, are freely open to the general public. Because a recognition of the appropriate limit of this substantive right of free speech is sufficient in itself to resolve this case, I believe it is unnecessary to reach out to decide the much broader question of whether section 2(a)’s right of “[e]very person [to] freely speak, write and publish his or her sentiments on all subjects” affords individuals, as a general matter and in all circumstances, protection against only “state action” and not against the conduct or actions of private parties.

Neither the parties nor the lower courts focused upon the broad issue of whether the state constitutional free speech clause applies, as a general matter, only to state action, and there is no reason to undertake to resolve that question here. Even if the apartment complex at issue had been publicly owned (and thus the state action doctrine clearly satisfied), the state constitutional right of free speech would not extend to the unsolicited distribution of pamphlets in the interior hallways of an apartment building that is not generally open to the public. Accordingly, although I concur in the judgment, I do not join the lead opinion’s discussion or conclusions with regard to the state action doctrine.

More than a half century ago, the New York Court of Appeals, in Watchtower Bible & Tract Soc, Inc. v. Metropolitan Life Ins. Co. (1948) 297 N.Y. 339, 79 N.E.2d 433 (Watchtower), unanimously declined to recognize either a state or federal constitutional right to solicit or distribute unsolicited pamphlets in the closed areas of a large private apartment complex. The court in Watchtower observed that “[a] narrow inner hallway on an upper floor of an apartment house is hardly an appropriate place at which to demand the free exercise of such rights (id., at p. 436), and that “no case we know of extends the reach of the Bill of Rights so far as to proscribe the reasonable regulation, by an owner, of conduct inside his multiple dwelling.” (Id., at [355] pp. 436-137, italics added.) Likewise, no decision of which I am aware, before or since Watchtower, has recognized a constitutional right to distribute unsolicited pamphlets in the closed interior hallways of privately owned apartment buildings or, for that matter, in any other analogous area that is closed to the general public.

The United States Supreme Court has found a First Amendment free speech right to picket or distribute literature on public streets and sidewalks, and in doing so it has emphasized the open nature of those locations as a basis for its conclusion. (E.g.,Thornhill v. Alabama (1940) 310 U.S. 88, 105-106, 60 S.Ct. 736, 84 L.Ed. 1093 (Thornhill); see also Hague v. C.I.O. (1939) 307 U.S. 496, 515-516, 59 S.Ct. 954, 83 L.Ed. 1423 [public streets and parks have been traditional grounds for exercise of free expression]; Lovell v. Griffin (1938) 303 U.S. 444, 58 S.Ct. 666, 82 L.Ed. 949[finding First Amendment right to distribute religious pamphlets on public sidewalks].) In Marsh v. Alabama (1946) 326 U.S. 501, 66 S.Ct. 276, 90 L.Ed. 265 (Marsh), the high court extended this rule to the business district of a private “company town.” The court in Marsh found a free speech right to distribute religious literature, and emphasized that the private town’s business district was “freely accessible and open” to the public. (Id., at p. 508, 66 S.Ct. 276.)^[FN.1]

In Schwartz-Torrance Investment Corp. v. Bakery & Confectionery Workers’ Union(1964) 61 Cal.2d 766, 40 Cal.Rptr. 233, 394 P.2d 921 (Schwartz-Torrance), this court, citing Thornhill and Marsh found a right to peacefully picket at a privately owned shopping center. In so concluding, we emphasized the public nature of the shopping center (Schwartz-Torrance, supra, at pp. 772-773, 40 Cal.Rptr. 233, 394 P.2d 921, and cases cited) and distinguished N.L.R.B. v. Babcock & Wilcox Co.(1956) 351 U.S. 105, 76 S.Ct. 679, 100 L.Ed. 975, in which the high court upheld an employer’s right to prohibit picketing in a company parking lot. We explained: “Unlike the . . . property in the present case, the Babcock & Wilcox parking lot was not generally open to the public.” (Schwartz-Torrance, supra, 61 Cal.2d at p. 774, 40 Cal.Rptr. 233, 394 P.2d 921.)

Subsequently, in In re Hoffman (1967) 67 Cal.2d 845, 64 Cal.Rptr. 97, 434 P.2d 353,we found a right to peacefully and unobtrusively distribute leaflets protesting the Vietnam War, in the privately owned Union Station of Los Angeles. In reaching our conclusion we emphasized that the railway station was a “spacious area open to the community as a center for rail transportation” (id., at p. 847, 64 Cal.Rptr. 97, 434 P.2d 353) and that in this respect it was analogous to a “public street or park” (id., at p. 851, 64 Cal.Rptr. 97, 434 P.2d 353).

Consistently with Schwartz-Torrance, in Food Employees v. Logan Plaza (1968) 391 U.S. 308, 88 S.Ct. 1601, 20 L.Ed.2d 603 (Logan Plaza), the high court found a free speech right to peacefully picket and distribute handbills in a privately owned shopping mall, and in so concluding emphasized the public’s “virtually unrestricted access” to the mall property. (Id., at p. 321, 88 S.Ct. 1601; see also id., at pp. 313, [356] 325, 88 S.Ct. 1601.) The court in Logan Valley observed that in circumstances in which “property is not ordinarily open to the public, this Court has held that access to it for the purpose of exercising First Amendment rights may be denied altogether.” (Id., at p. 320, 88 S.Ct. 1601, italics added.)^[FN.2]

In In re Lane (1969) 71 Cal.2d 872, 79 Cal.Rptr. 729, 457 P.2d 561, we found a right to peacefully distribute labor union handbills on a private sidewalk abutting a large “stand alone” supermarket. In so concluding we cited and followed the above cases and emphasized that the private sidewalk was “open to the public” and that “[t]he public is openly invited to use it.” (Id., at p. 878, 79 Cal.Rptr. 729, 457 P.2d 561.)

Robins v. Pruneyard (1979) 23 Cal.3d 899, 153 Cal.Rptr. 854, 592 P.2d 341 (Robins), affirmed sub nom. Pruneyard Shopping Center v. Robins (1980) 447 U.S. 74, 100 S.Ct. 2035, 64 L.Ed.2d 741, followed this same approach, finding a right under section 2(a) to seek petition signatures and to speak with patrons on a matter of public interest in a privately owned shopping center. Our decision in Robinsemphasized that the center was freely open to the public (Robins, supra, 23 Cal.3d at pp. 902, 909-911, 153 Cal.Rptr. 854, 592 P.2d 341), and indeed we implicitly exempted “`an individual homeowner'” from our holding (id, at p. 910, 153 Cal.Rptr. 854, 592 P.2d 341), presumably, as the lead opinion notes, “because individual homes are not freely and openly accessible to the public.” (Lead opn., ante, 111 Cal.Rptr.2d at p. 351, 29 P.3d at p. 809.)

California decisions filed since Robins, finding a state constitutional free speech right to distribute pamphlets or to picket, have continued to emphasize the open nature of the location where the rights were to be exercised. (E.g., Sears, Roebuck & Co. v. San Diego District Council of Carpenters (1979) 25 Cal.3d 317, 328, 332, 158 Cal.Rptr. 370, 599 P.2d 676 [upholding union’s free speech right to picket on employer’s privately owned sidewalks surrounding its store; court emphasized that the sidewalk was open to the general public and was a “traditional and accepted place where unions may, by peaceful picketing, present to the public their views respecting a labor dispute with that store”]; Prisoners Union v. Department of Corrections (1982) 135 Cal.App.3d 930, 932, 185 Cal. Rptr. 634 [recognizing the right to distribute pamphlets in a prison parking lot “open to members of the general public”]; Westside Sane/Freeze v. Hahn (1990) 224 Cal.App.3d 546, 552-556, 274 Cal.Rptr. 51 [upholding political group’s free speech right to distribute leaflets at a privately owned shopping center; court asserted that the shopping center, to which the public was invited, was a public forum for exercising free speech rights]; see also Los Angeles Alliance for Survival v. City of Los Angeles (2000) 22 Cal.4th 352, 363, 364, 93 Cal.Rptr.2d 1, 993 P.2d 334 [ordinance that regulated and banned solicitation of funds in “public places,” including sidewalks, bus stops, and restaurants, “plainly implicate[d]” section 2(a)’s free speech right].)

Sister state decisions that have found a state constitutional free speech right to distribute pamphlets in private shopping centers likewise have stressed the open and public nature of the forum. (See Bock v. Westminster Mall Co. (Colo.1991) 819 P.2d 55, 61-63; New Jersey Coalition Against War v. J.M.B. Realty Corp. (1994) 138 N.J. 326, 650 A.2d 757, 771-774.) Similarly, state court decisions that have recognized other state constitutional rights [357] (distinct from a free speech right) to solicit signatures at private shopping centers also have emphasized the open and public nature of the forum. (See Batchelder v. Allied Stores Intern., Inc. (1983) 388 Mass. 83, 445 N.E.2d 590, 595 (Batchelder) [finding right to solicit signatures under state constitution’s “freedom and equality of elections” provision];^[FN.3] Alderwood Associates v. Washington Environmental Council (1981) 96 Wash.2d 230, 635 P.2d 108, 116-117 (Alderwood) [finding right to solicit signatures under state constitution’s initiative provision].)^[FN.4]

As these decisions suggest, the acts of distributing unsolicited pamphlets, picketing, and soliciting signatures or funds traditionally are performed in places open to the general public—that is, in places sometimes referred to as public forums.^[FN.5] In light of this tradition, when one speaks of a “constitutional right” to engage in such conduct, one cannot reasonably have in mind an asserted right to invade the interior hallways of a private business structure, home, or apartment complex, in order to proffer an unsolicited flier, placard or petition. Under the foregoing decisions, there is no state or federal constitutional right to distribute unsolicited pamphlets in a location (whether publicly or privately owned) not open to the general public, such as the closed interior hallways of the apartment buildings here at issue. (Watchtower, supra, 297 N.Y. 339, 79 N.E.2d 433, 436-37, quoted ante, 111 Cal.Rptr.2d at p. 354, 29 P.3d at p. 812;Hall v. Virginia (1948) 188 Va. 72, 49 S.E.2d 369, 375-378 [there is no constitutional right to distribute unsolicited pamphlets [358] in the interior hallways of an apartment complex]; Annot., Right of Owner of Housing Development or Apartment Houses to Restrict Canvassing, Peddling, Solicitation of Contributions, etc. (1949) 3 A.L.R.2d 1431, 1432-1433[“[R]egulations of . . . apartment house owners, which have the effect of restricting . . . solicitation, etc., will not be held . . . unconstitutional as violating constitutional guaranties of others to freedom of religion, speech, or press, where the activities are curtailed in places . . . not public or quasi-public in nature, and where the rights of persons to privacy in their dwelling places are protected from infringement by such regulations”]; see also Batchelder, supra, 388 Mass. 83, 445 N.E.2d 590, 595, quoted ante, at fn. 3.)

In the case now before us, the landlord has limited hallway access to residential tenants and their invitees, and has excluded the general public. Accordingly, this case is quite different from Robins, supra, 23 Cal.3d 899, 153 Cal.Rptr. 854, 592 P.2d 341, and the other free speech cases discussed above. A free speech right to distribute unsolicited pamphlets in places open to the general public simply is not triggered on the facts presented.

It is thus apparent that the state action doctrine is irrelevant to this case. Had the apartment complex been owned by the state and had the apartment been operated in the same manner as here—that is, by restricting access to interior hallways to tenants and their invitees—the tenants still would have no section 2(a) free speech right to distribute unsolicited pamphlets in the buildings’ interior hallways, because, as noted above, the constitutional right conferred by section 2(a) to distribute unsolicited pamphlets is inapplicable to the interior hallways of apartment buildings that are closed to the general public.

II.

It is important to emphasize what we do not consider or decide in this case. We do not face any effort by a landlord to ban all discourse by tenants in the closed hallways. Tenants remain free to speak with each other in the hallways or elsewhere about anything they wish. Tenants may knock on the doors of other tenants and speak with them. They may telephone or fax each other, or correspond by letter or e-mail. Pursuant to the landlord’s rules, they may post fliers on the bulletin boards of the laundry rooms, and they may even, upon request, deliver, and leave at the door of another tenant, the very same pamphlets whose intended distribution triggered this case. As relevant here, the landlord’s rule simply prohibits the tenants association from leaving unsolicited pamphlets on or under the hallway doors of fellow tenants, or in a pile for the taking in the hallway.

Furthermore, although I conclude for the reasons discussed above that the tenants association possesses no constitutional right to leave the unsolicited pamphlets here at issue in the hallways or on or under the hallway doors of fellow tenants, it does not necessarily follow that tenants have no right of any sort to do so. Tenants in fact may have such rights, depending upon the terms of the applicable lease or a statute, or based upon general principles of landlord-tenant law. (See, e.g., Civ.Code, §§ 1942.5, 1942.6, 1953; Lobsenz & Swanson, The Residential Tenant’s Right to Freedom of Political Expression (1986) 10 U. Puget Sound L.Rev. 1, 39-41, 45-49.) Because the only issue upon which we granted review is whether the state constitutional right of free speech extends to the distribution of pamphlets in the interior hallways of an apartment building that is not open to the public, we have no occasion to decide whether tenants [359] or a tenants association may derive such a right from some other source.

III.

There is much to be said for taking an incrementalist approach to appellate decisionmaking, and such jurisprudential considerations apply especially when, as here, we face the significant task of defining the contours of an aspect of the state constitutional right of free speech that we have not addressed for more than two decades. The analysis set forth above affords a fully adequate basis upon which to resolve this matter, and I believe the court can, and should, leave to another day and another case the difficult task of further defining and clarifying the scope of section 2(a)’s free speech right. I note that one such case, Waremart, Inc. v. Progressive Campaigns (2000) 85 Cal.App.4th 679, 102 Cal.Rptr.2d 392, review granted March 14, 2001, S094236, already is pending before our court.

Instead of resolving this case narrowly on the basis of the issue discussed above, the lead opinion proposes to hold that state action or its equivalent must be established in order to raise any claim under section 2(a) (lead opn., ante, 111 Cal. Rptr.2d at p. 350, 29 P.3d at p. 809), and further suggests that “private property must be public in character before California’s free speech clause may apply.” (Id., at pp. 351-352, 29 P.3d at pp. 809-810, italics added.) But even if one were to accept the lead opinion’s assertion that a finding of state action or its equivalent is required with regard to the specific subcategory of free speech here at issue—the right to distribute unsolicited pamphlets— such a determination would not, in my view, necessarily control other types of free speech claims that might be asserted under section 2(a). By proposing to reach the state action issue, and by speaking broadly and asserting that as a general matter, section 2(a) can afford no type of free speech right with regard to a forum that is both privately owned and closed to the general public, the lead opinion says more than it needs to, and more than is supported by our prior decisions.

When, in a future case, this court does address and decide whether, and in what circumstances, section 2(a) should be construed as requiring a showing of state action, it will be helpful to consider the diverse circumstances in which the free speech clause might be implicated. I have in mind circumstances in which a private person or entity may attempt to utilize its power or authority in one sphere to censor or undermine what might be viewed as another individual’s “core” free speech rights. Consider a private landlord who, under penalty of eviction, precludes his or her tenants from displaying in the windows of their apartments the campaign poster of a particular political candidate supported by the tenant.—or requires the tenants to display in the windows of their homes a poster of the candidate supported by the landlord. Or consider a union or employer that attempts to utilize its power over an individual by precluding certain bumper stickers on vehicles parked in the employer’s or union’s parking lot, or by requiring that the employee place a certain bumper sticker on his or her vehicle or attend a rally and make a political contribution, unconnected to employment-related issues, in support of a candidate favored by the union or employer but not supported by the employee.

If we were to hold, as the lead opinion broadly would, that all types of section 2(a) free speech claims require state action (or its equivalent, shown by establishing that the location where the speech is exercised is the “functional equivalent of a traditional public forum”) (lead opn., ante, [360] 111 Cal.Rptr.2d at p. 352, 29 P.3d at p. 810), we effectively would remove any state constitutional obstacle to any such action by a landlord, union, or employer. I see no reason to prejudge the resolution of such questions.

Given the variety of circumstances in which free speech concerns may come into play, and the difficulty of predicting how the presence or absence of a “state action” requirement might affect the practical protection conferred by the free speech right embodied in the California Constitution’s free speech clause, I believe we should proceed cautiously and limit our decision to the context presented by the facts before us.

IV.

I join in the judgment of the court, because I believe that section 2(a) of the California Constitution has no application in the context presented here. I would decide no more.

Dissenting Opinion by WERDEGAR, J.

A majority of this court, while divided in their reasons for so doing, today join in immunizing from state constitutional scrutiny a commercial residential landlord’s suppression of speech among its tenants. Guided by our precedents and the clear language of our state Constitution, I respectfully dissent.

Background

Plaintiff Golden Gateway Center (Golden Gateway) is landlord of a multi-building commercial and residential apartment complex containing 1,254 residential units; defendant Golden Gateway Tenants Association (Tenants Association), formed in 1982, is a group of residential tenants in the complex. Golden Gateway incorporates by reference in each of its residential lease agreements certain “Building Standards.” Among these, at relevant times through June 1996, was a provision entitled “Soliciting,” which read, in its entirety: “Any soliciting within the building is absolutely forbidden. Should a solicitor appear, please notify the Owner so that appropriate action may be taken.”

From the time of its formation in 1982 until 1993, the Tenants Association periodically distributed a newsletter on or under the apartment doors of Golden Gateway’s residents. For these approximately 11 years, Golden Gateway did not object to the Tenants Association’s leafleting. Golden Gateway, for its part, also distributed papers under residents’ doors (and posted them in common areas, such as the elevators), when such modes of communication served its management’s needs and interests.

In 1993, citing the Building Standards, Golden Gateway asked the Tenants Association to stop distributing newsletters at tenants’ doors. The Tenants Association refused, inter alia, on constitutional free speech grounds, and continued to distribute its newsletters.

In 1996, shortly after the Tenants Association filed a lawsuit against Golden Gateway opposing “hotelization” of the complex and distributed some leaflets critical of Golden Gateway’s management, Golden Gateway demanded that the Tenants Association cease “dissemination of politically based material.” When the Tenants Association refused, Golden Gateway revised its Building Standards expressly to forbid all “leafleting,” stating that any such within the building “is absolutely forbidden” other than “on the bulletin boards located in the laundry rooms” or at the specific request of a tenant. The Tenants Association continued its distribution practices, and Golden Gateway ultimately sought the injunction that is the subject of this litigation. [361] The Tenants Association cross-complained, seeking a declaration that it could continue leafleting at tenants’ doors.

The trial court preliminarily enjoined the Tenants Association from leafleting. After trial, however, the court dissolved the injunction, ruling that the Tenants Association had a contractual right to distribute its newsletter at tenants’ doors and on laundry room bulletin boards. The Court of Appeal reversed, and we granted review on petition of the Tenants Association.

Discussion

Our state Constitution provides that “[e]very person may freely speak, write and publish his or her sentiments on all subjects, being responsible for the abuse of this right.” (Cal. Const., art. I, § 2, subd. (a); hereafter section 2(a) or the state free speech clause.)^[FN.1] This unambiguous language should afford California apartment complex dwellers the freedom, subject to reasonable regulation, to communicate in writing with each other on their residential premises, including, as relevant in this case, at each others’ front doors, about matters in their common interest as tenants.

At the outset, it is important to emphasize the narrowness of the question we are called upon to decide. No question is raised as to whether the Tenants Association or its members have waived their leafleting or other communicative rights. Nor do we have before us a landlord’s attempt to curb purely commercial or nontenant activity. Finally, Golden Gateway’s property rights are not those “`of an individual homeowner or the proprietor of a modest retail establishment'” (Robins v. Pruneyard Shopping Center (1979) 23 Cal.3d 899, 910, 153 Cal.Rptr. 854, 592 P.2d 341 (Robins), affd.sub nom. Pruneyard Shopping Center v. Robins (1980) 447 U.S. 74, 100 S.Ct. 2035, 64 L.Ed.2d 741). We need not decide today, therefore, what result an appropriate constitutional analysis would generate in such cases. The sole question we face is whether the residents of a large multibuilding apartment community have the right, as against the landlord’s wishes, to communicate with each other through the distribution at their front doors of leaflets, subject to reasonable time, place, and manner regulations and the right of any resident who so wishes to opt out of receiving such communications. I would hold that they do.

In providing that all Californians “may freely speak, write and publish” their sentiments, the framers of the state free speech clause drew no distinction, among those who might seek to obstruct such activities, between state and private actors. They specified instead, in plain language, a right of free speech that runs against both—and protects against interference by either. Thus, as we observed only last year, section 2(a)’s “right to freedom of speech, unlike the First Amendment’s, is unbounded in range. It runs against the world, including private parties as well as governmental actors.” (Gerawan Farming, Inc. v. Lyons (2000) 24 Cal.4th 468, 492, 101 Cal.Rptr.2d 470, 12 P.3d 720 (Gerawan), citing Robins, supra, 23 Cal.3d at pp. 908-911, 153 Cal.Rptr. 854, 592 P.2d 341; Fritz, More Than “Shreds and Patches”: California’s First Bill of Rights (1989) 17 Hastings Const. L.Q. 13, 31; Friesen,Should California’s Constitutional [362] Guarantees of Individual Rights Apply Against Private Actors? (1989) 17 Hastings Const. L.Q. 111, 118, 119-122 (Private Actors).)

Section 2(a) also, as the lead opinion emphasizes, provides that “[a] law may not restrain or abridge liberty of speech or press,” thus explicitly prohibiting state legislative, and implicitly prohibiting state executive and judicial, suppression of protected speech. But the latter proviso neither grammatically nor legally qualifies the simple and sweeping free speech guarantee with which section 2(a) begins. Nor, contrary to the lead opinion, does that proviso indicate an intent that the clause as a whole protect against only state actions (lead opn., ante, 111 Cal.Rptr.2d at p. 344, 29 P.3d at p. 804). Rather, as the lead opinion concedes and as commentators have observed, that the “express prohibition against a `law’ restraining or abridging free speech” (ibid.) resides in (and on its face purports to govern) the second sentence, alone, “arguably bolsters such an interpretation” (ibid.) of the clause as a whole as would infer “an intent to protect the right to free speech against private intrusions” (id.at p. 344, 29 P.3d at p. 804, citing Private Actors, supra, 17 Hastings Const. L.Q. at pp. 119-121).

In consequence of section 2(a)’s plain language, we consistently have rejected any suggestion that California’s free speech clause carries a state action limitation. We first held more than 20 years ago that it carries no such limitation. (Robins, supra, 23 Cal.3d at p. 910, 153 Cal.Rptr. 854, 592 P.2d 341.)

In Robins, we stated “that sections 2 and 3 of article I of the California Constitution protect speech and petitioning, reasonably exercised, in shopping centers even when the centers are privately owned.” (Robins, supra, 23 Cal.3d at p. 910, 153 Cal.Rptr. 854, 592 P.2d 341, italics added.) Although our rejection in Robins of a state action requirement was only implicit, the lead opinion is mistaken in asserting we there did not address whether California’s free speech clause protects against only state action or against private conduct as well. (Lead opn., ante, 111 Cal.Rptr.2d at p. 341, 29 P.3d at p. 801.) We had no choice but to address that issue, as the conduct complained of in Robins—a commercial landlord’s policy “not to permit any tenant or visitor to engage in publicly expressive activity” (Robins, supra, 23 Cal.3d at p. 902, 153 Cal.Rptr. 854, 592 P.2d 341)—was “that [of] a private individual” (Laguna Publishing Co. v. Golden Rain Foundation (1982) 131 Cal. App.3d 816, 838, 182 Cal.Rptr. 813). We properly treat courts’ implicit holdings as equivalent, legally and logically, to their explicit ones (see, e.g., Chapman v. Pitcher (1929) 207 Cal. 63, 68, 276 P. 1008; People v. McCoy (2001) 25 Cal.4th 1111, 1121, 108 Cal.Rptr.2d 188, 24 P.3d 1210), and no reason appears why we should treat Robins differently.

Some commentators apparently, at least for a time, found Robins‘s applicability outside its context of a large shopping center uncertain because we there discussed “the role of the centers in our society” and emphasized the case did not implicate “`the property or privacy rights of an individual homeowner or the proprietor of a modest retail establishment'” (Robins, supra, 23 Cal.3d at p. 910, 153 Cal.Rptr. 854, 592 P.2d 341). But any questions left open by Robins on the state action question were laid to rest in Gerawan, where we stated unambiguously that the right of free speech granted by the state free speech clause “runs against the world, including private parties as well as governmental actors” (Gerawan, supra, 24 Cal.4th at p. 492, 101 Cal.Rptr.2d 470, 12 P.3d 720). Indeed, we cited Robins (23 [363] Cal.3d at pp. 908-911, 153 Cal.Rptr. 854, 592 P.2d 341) for that very proposition.

The lead opinion dismisses Gerawan‘s discussion of state action as “nonbinding dictum.” (Lead opn., ante, 111 Cal.Rptr.2d at p. 348, 29 P.3d at p. 807.) Nevertheless, for many of the same reasons, presumably, as led the author of the lead opinion only eight months ago to sign the majority opinion in Gerawan, I disagree that Gerawan‘s dictum is unpersuasive. Gerawan based its rejection of a state action requirement on section 2(a)’s plain language (Gerawan, supra, 24 Cal.4th at pp. 489-92, 101 Cal.Rptr.2d 470, 12 P.3d 720), buttressed by “the peculiar character of constitutions [like California’s] dating to the 19th century, which are not so narrow” as to restrain only governmental actors (id. at p. 492, 101 Cal. Rptr.2d 470, 12 P.3d 720). The Gerawan majority cited textual proof that the California Constitution must be counted among those that were drafted to protect against private, as well as governmental, intrusion on constitutional rights. (See Gerawan, supra, 24 Cal.4th at p. 493, 101 Cal.Rptr.2d 470, 12 P.3d 720 [citing constitutional grant to wives of a separate property right as against their husbands and to husbands and wives a similar right as against one another].) I continue to find Gerawan’s analysis persuasive—its plain-language rationale for the reasons earlier stated, and its constitutional-character rationale on the basis of the scholarly authorities and textual examples that Geraivan provided.^[FN.2]

Gerawan‘s progenitor, Robins, as the lead opinion recognizes, “has been the law in California for over 20 years” and is “embedded in our free speech jurisprudence with no apparent ill effects” (lead opn., ante, 111 Cal.Rptr.2d at p. 343, 29 P.3d at p. 803). Principles of stare decisis, therefore, oblige us to follow its holding. As explained above, that holding logically implies that section 2(a) carries no state action limitation.

Concededly, the result in Robins might be reconcilable with a rule—similar, perhaps, to that the lead opinion proffers— that would make free and open accessibility to the public a “threshold requirement” for applying the state free speech clause to the actions of a private property owner. (Lead opn., ante, 111 Cal.Rptr.2d at p. 352, 29 P.3d at p. 810.) But our analysis in Robins would not be so reconcilable.

Thus, when we referred in Robins to Court of Appeal cases citing the United States Supreme Court’s decisions in Marsh v. Alabama (1946) 326 U.S. 501, 66 S.Ct. 276, 90 L.Ed. 265 and Food Employees v. Logan Plaza (1968) 391 U.S. 308, 88 S.Ct. 1601, 20 L.Ed.2d 603, we did so not with implicit approval of any state action reasoning in those underlying federal decisions (see lead opn., ante, 111 Cal. Rptr.2d at p. 351, 29 P.3d at p. 809); rather, we believed the Court of Appeal opinions to be useful in illustrating “the strength of `liberty of speech’ in this state.” (Robins, supra,23 Cal.3d at p. 908, 153 Cal.Rptr. 854, 592 P.2d 341.) Irrespective of federal principles, we noted, “[t]he duty of this court is to help determine what `liberty of speech’ means in [364] California.” (Id at p. 909, 153 Cal.Rptr. 854, 592 P.2d 341, italics added.)

Ultimately, we explained our holding in Robins as “providing greater protection than the First Amendment now seems to provide” (Robins, supra, 23 Cal.3d at p. 910, 153 Cal.Rptr. 854, 592 P.2d 341), affirming the long-standing principle that a “`protective provision more definitive and inclusive than the First Amendment is contained in our state constitutional guarantee'” (id. at p. 908, 153 Cal.Rptr. 854, 592 P.2d 341).

Our decision in Robins rested expressly on our understanding “that sections 2 and 3 of article I of the California Constitution protect speech and petitioning, reasonably exercised,” even on private property (Robins, supra, 23 Cal.3d at p. 910, 153 Cal. Rptr. 854, 592 P.2d 341) and not on any “functional equivalence of the shopping center to a traditional public forum” (lead opn., ante, 111 Cal.Rptr.2d at p. 351, 29 P.3d at p. 809). In Robins, far from finding this functional equivalence, we found, much more modestly, that “`[a] handful of additional orderly persons soliciting signatures and distributing handbills in connection therewith, under reasonable regulations adopted by defendant to assure that these activities do not interfere with normal business operations [citation] would not markedly dilute defendant’s property rights.'” (Robins, supra, 23 Cal.3d at p. 911, 153 Cal.Rptr. 854, 592 P.2d 341.) In considering the competing constitutional rights at stake, we nowhere referred, categorically, to “the public character of the property” (lead opn., ante, at p. 351, 29 P.3d at p. 809).^[FN.3] Rather, we considered the interest in “speech and petitioning, reasonably exercised,” and “the role of [shopping] centers in our society” (Robins, supra, 23 Cal.3d at p. 910, 153 Cal.Rptr. 854, 592 P.2d 341) in facilitating the exercise of such rights as against the “`defendant’s property rights'” (id. at p. 911,153 Cal.Rptr. 854, 592 P.2d 341), emphasizing that our result, in favoring free speech, might be different if “`we . . . ha[d] under consideration the property or privacy rights of an individual homeowner or the proprietor of a modest retail establishment'” (id. at p. 910, 153 Cal.Rptr. 854, 592 P.2d 341). We also expressly preserved property owners’ right, despite constitutional constraints, to impose “`reasonable regulations'” (id. at p. 911, 153 Cal. Rptr. 854, 592 P.2d 341), avoiding any implication “that those who wish to disseminate ideas have free rein” (id at p. 910, 153 Cal.Rptr. 854, 592 P.2d 341).

In Robins we thus followed “the familiar and well-established constitutional analysis—applicable to other constitutional rights, such as freedom of speech . . . ____ under which a court considers the extent to which a defendant’s actions infringe or intrude upon the plaintiffs constitutionally protected interest and `balances’ or `weighs’ such infringement against the relative importance or `compelling’ nature of the defendant’s justifications for its actions (taking into account whether there are other, less intrusive means by which the defendant could achieve its objectives).” (Hill v. National Collegiate Athletic Assn. (1994) 7 Cal.4th 1, 62, 26 Cal.Rptr.2d 834, 865 P.2d 633 (cone. & dis. opn. of George, J.).)^[FN.4]

We should adhere to our established constitutional jurisprudence in this case. Consequently, unless we conclude Golden [365] Gateway’s leafleting ban is a reasonable regulation of the speech at issue, we must balance the private and societal interest in that speech against any competing constitutional concerns that would be implicated were we to rule that section 2(a) forbids enforcement of that ban. (See, e.g., Robins, supra, 23 Cal.3d at pp. 910-911, 153 Cal.Rptr. 854, 592 P.2d 341[balancing signature gatherers'”wish to disseminate ideas” with concern “`that these activities do not interfere with normal business operations'” and “`property or privacy rights'” of occupants and owners].) We must also take into account the ban’s impact on the right of Californians, generally, to receive unsolicited communications. (See generally Van Nuys Pub. Co. v. City of Thousand Oaks (1971) 5 Cal.3d 817, 825-826, 97 Cal.Rptr. 777, 489 P.2d 809 (Van Nuys); see also Martin v. City of Struthers(1943) 319 U.S. 141, 148-149, 63 S.Ct. 862, 87 L.Ed. 1313.)^[FN.5]

A. Is the ban a reasonable regulation of affected speech?

Golden Gateway unquestionably retains the right to impose reasonable time, place, and manner restrictions on expressive activity at its premises. (Robins, supra, 23 Cal.3d at pp. 910-911, 153 Cal.Rptr. 854, 592 P.2d 341; In re Hoffman (1967) 67 Cal.2d 845, 852-853, 64 Cal.Rptr. 97, 434 P.2d 353.) Such restrictions must, however, be “`”justified without reference to the content of the regulated speech, . . . narrowly tailored . . ., and . . . leave open ample alternative channels for communication of the information.”‘” (Savage v. Trammell Crow Co. (1990) 223 Cal.App.3d 1562, 1573, 273 Cal.Rptr. 302, quoting Clark v. Community for Creative Nonviolence (1984) 468 U.S. 288, 293, 104 S.Ct. 3065, 82 L.Ed.2d 221.)

1. Does the ban afford ample alternative channels for communication?

Even assuming Golden Gateway’s leafleting ban can be considered content neutral,^[FN.6] the record demonstrates that it fails to leave open ample alternative channels of communication, in that its only allowance for distribution of unsolicited printed matter is posting on laundry room bulletin boards.

[366] Neither that the Tenants Association can use the public mails nor that it can distribute its leaflets off Golden Gateway’s premises provides a constitutional alternative to door-to-door leafleting. Mailing a single leaflet to each address, the record suggests, would cost the Tenants Association more than $500, even assuming it could muster the volunteers to assemble, stuff, and address 1,254 envelopes. (See generally City of Watseka v. Illinois Public Action Council (7th Cir.1986) 796 F.2d 1547, 1558 [mail and telephone not sufficient because “more expensive and less effective than in-person solicitation at the citizen’s residence”].) Nor would standing on the sidewalk near the complex afford Tenant Association speakers a reasonable opportunity to “directly communicate their message to their targeted audience” (Planned Parenthood v. Wilson (1991) 234 Cal.App.3d 1662, 1674, 286 Cal.Rptr. 427), some of whom (e.g., automobile drivers) may not use those sidewalks at all and all of whom, presumably, use them at most intermittently. As the United States Supreme Court has noted, “the most effective way of bringing [informational materials] to the notice of individuals is their distribution at the homes of people.” (Schneider v. New Jersey (1939) 308 U.S. 147, 164, 60 S.Ct. 146, 84 L.Ed. 155; accord, Van Nuys, supra, 5 Cal.3d at pp. 823-825, 97 Cal.Rptr. 777, 489 P.2d 809.)

Although oral communication among tenants may be permitted, as the concurring opinion suggests (cone, opn., ante, 111 Cal.Rptr.2d at p. 358, 29 P.3d at p. 815),^[FN.7]the Building Standards forbid all unrequested published discourse by tenants except in the laundry rooms. As the state free speech clause protects the freedom of Californians to “write and publish” equally and identically with their right to “speak” their sentiments on all subjects, the Building Standards banning written and published discourse offend the clause equally and identically as would a rule that entirely forbade tenants to speak with each other on the premises except in the laundry rooms.

Is the ban narrowly tailored to accomplish its legitimate objectives?

The record also establishes that Golden Gateway’s ban on solicitations and leafleting goes much further than is necessary to address its asserted legitimate concerns for tenant safety, tenant privacy, or cleanliness of the premises. As Golden Gateway conceded at trial, no breaches of security have occurred as a result of leaflet distribution. With respect to litter concerns, Golden Gateway acknowledged the Tenants Association already has agreed to retrieve from around tenants’ doors, within 24 hours of distribution, any of its newsletters or leaflets that have not been collected by their intended recipients.

Nor would enforcing Golden Gateway’s ban necessarily significantly enhance tenant privacy. While one of Golden Gateway’s property managers opined at trial that unsolicited leafleting constituted an invasion of tenant privacy, he conceded that the only available alternative under Golden Gateway’s ban, unrequested mail or telephone calls, would equally be so. And Golden Gateway conceded at trial that the Tenants Association already has agreed not to distribute leaflets or newsletters to any tenant who indicates a desire not to receive them. Were Golden Gateway’s [367] regulations more narrowly tailored in that direction, a tenant who prefers not to receive leaflets could simply post a “no leafleting” sign or appropriately advise the Tenants Association.

Golden Gateway’s ban thus operates far more broadly than is necessary to effect its legitimate purposes. It may not, therefore, be enforced as merely a reasonable regulation of the time, place, or manner of the speech it would affect. (Savage v. Trammell Crow Co., supra, 223 Cal. App.3d at p. 1573, 273 Cal.Rptr. 302.)

B. Balancing of affected constitutional interests

Since Golden Gateway’s ban is not a reasonable regulation, we must, in order to resolve this matter, balance the competing constitutional interests implicated in its efforts to prohibit the Tenants Association’s leafleting. (See Robins, supra, 23 Cal.3d at pp. 910-911, 153 Cal.Rptr. 854, 592 P.2d 341.) Such interests include, on the one hand, the Tenants Association’s interest in freely speaking, writing and publishing to tenants at Golden Gateway Center and those tenants’ interest in receiving the Tenants Association’s written communications. They include, on the other hand, the privacy interests of individual tenants and Golden Gateway’s property interests.

Free speech

The Tenants Association understandably desires to communicate regularly with the tenants of Golden Gateway about Tenants Association business and tenants’ issues, generally. As previously noted, moreover, Golden Gateway tenants have a recognized interest in receiving even unsolicited communications. (See generally Martin v. City of Struthers, supra, 319 U.S. at pp. 147-148, 63 S.Ct. 862; Van Nuys, supra, 5 Cal.3d at pp. 825-826, 97 Cal.Rptr. 777, 489 P.2d 809.) We should be mindful of the “paramount and preferred place” that free speech enjoys in the hierarchy of rights in this state (In re Lane (1969) 71 Cal.2d 872, 878, 79 Cal.Rptr. 729, 457 P.2d 561) and also should strive to avoid any balancing of constitutional interests that would relegate California apartment dwellers, as a group, to inferior status among speakers.

Property rights

Plaintiff, as landlord, complains its property rights will be diminished if its leafleting ban is not enforced. Such concerns, legitimate in the abstract, would seem overblown in this case to the extent that the tenants of Golden Gateway already have undisputed rights to be present in the hallways and throughout the common areas of their complex. Pursuant to their lease agreements, the tenants have the contractual right to be present in the hallways and throughout the common areas of the Golden Gateway Center. They also possess property rights entitling them to occupy and utilize the premises. Leaseholds possessed by tenants are as much estates in property as is a landlord’s remaining ownership interest. Therefore, to construe section 2(a) to require of Golden Gateway a more appropriately tailored approach to regulation of tenant leafleting, as a matter of both law and fact, “`would not markedly dilute [the landlord]’s property rights'” (Robins, supra, 23 Cal.3d at p. 911, 153 Cal.Rptr. 854, 592 P.2d 341).

Tenant privacy

Golden Gateway makes much of the insulation from unsolicited appeals (and the high rents assertedly paid for such insulation) that the Building Standards purportedly are designed to preserve. As demonstrated, however, Golden Gateway’s policies go far beyond reasonable regulation directed to such insulation. Even assuming [368] that privacy concerns loom as large, practically speaking, as plaintiff would have us believe,^[FN.8] we should remain mindful that “a community may not suppress . . . the dissemination of views because they are unpopular, annoying or distasteful.” (Murdoch v. Pennsylvania (1943) 319 U.S. 105, 116, 63 S.Ct. 870, 87 L.Ed. 1292.)

Enforcement of Golden Gateway’s leafleting ban, which forbids the provision to any tenant of any leaflet not specially requested in advance, significantly would impact “the constitutional rights of those desiring to distribute literature and those desiring to receive it, as well as those who choose to exclude such distributers from the home.” (Martin v. City of Struthers, supra, 319 U.S. at pp. 148-149, 63 S.Ct. 862.) The net effect of enforcing Golden Gateway’s total ban will be to deprive the residents of this sizable community of a traditional and important means of communicating with each other.

Ultimately, the appropriate “balance is tipped in favor of the right to voice ideas as opposed to the property rights or mere naked title of the owners” (Allred v. Shawley(1991) 232 Cal.App.3d 1489, 1496, 284 Cal.Rptr. 140) of Golden Gateway Center.^[FN.9]And in my view, “proper accommodation of the competing [free speech] and privacy values at issue requires that the initial burden be placed on the homeowner to express his objection to the distribution of material.” (Van Nuys, supra, 5 Cal.3d at p. 826, 97 Cal.Rptr. 777, 489 P.2d 809.)^[FN.10]

II.

The lead opinion never engages in a traditional analysis along the lines of the foregoing, arguing rather that Golden Gateway’s restrictions on tenant speech do not implicate the state free speech clause in the first place. It takes as its fundamental premise that the state free speech clause protects only against state action, defining “the scope of this limitation” (lead opn., ante, 111 Cal.Rptr.2d at p. 350, 29 P.3d at p. 809) as encompassing “the actions of a private property owner . . . only if the property is freely and openly accessible to the public” (id. at p. 352, 29 P.3d at p. 810).^[FN.11]

[369] For support, the lead opinion cites Gay Law Students Assn. v. Pacific Tel. & Tel. Co. (1979) 24 Cal.3d 458, 156 Cal.Rptr. 14, 595 P.2d 592, apparently for the proposition that state constitutional provisions carry a state action limitation “absent some `suggestion’ in the provision’s history” to the contrary. (Lead opn., ante, 111 Cal.Rptr.2d at p. 344, 29 P.3d at p. 804.) But this court neither expressly nor impliedly addressed in Gay Law Students the question whether some kind of presumption of that nature might exist. Further, in Gay Law Students we spoke only to “the equal protection clause of the California Constitution” (24 Cal.3d at p. 466, 156 Cal.Rptr. 14, 595 P.2d 592) and its “predecessor provision” (id. at p. 468, 156 Cal. Rptr. 14, 595 P.2d 592). Similarly, in Jones v. Kmart Corp. (1998) 17 Cal.4th 329, 333, 70 Cal.Rptr.2d 844, 949 P.2d 941, the other case cited by the lead opinion on this point, we spoke to the state search and seizure provision. As the lead opinion’s own authority notes, the question of “whether to apply constitutional restraints on private actors” is properly approached “only by reference to the text, history and purpose of individual clauses of the California Declaration of Rights. It must be answered separately for each clause, not generally for the entire constitution.” (Private Actors, supra, 17 Hastings Const. L.Q. at pp. 111-112.)

Next, while acknowledging the absence from section 2(a) of an explicit state action limitation, the lead opinion asserts the state free speech clause nevertheless is ambiguous as to the implicit presence or absence of such a limitation. (Lead opn.,ante, 111 Cal.Rptr.2d at p. 344, 29 P.3d at p. 804.) The lead opinion finds such ambiguity in the second sentence of the clause, asserting that its reference to “law” abridging the liberty of speech or press might mean the framers feared only government intrusion, thus indicating an intent to protect only against state actions. (Id. at p. 344, 29 P.3d at p. 804.) Such an inference is neither logically nor grammatically supportable.

First, although a type of state action requirement might be discerned in the clause’s second sentence if it stood alone or purported to qualify the first sentence, as noted it does neither. The second sentence is preceded by and makes no reference to the first sentence; the first sentence, in turn, grants the free speech right without any limitation except that of responsibility for abuse of the right. The presence of the second sentence, with its express reference to state action in the form of “law,” in fact bolsters the case for construing the first sentence in accord with its plain language, i.e., in accord with its lack of any such reference, and for construing the entire clause in accord with its plain language, i.e., in accord with the lack of any qualification on the scope of the free speech right it confers.

Second, scholars have recognized that the phrase “being responsible for the abuse of this right” in the first sentence of section 2(a) offers contextual evidence the framers’ were aware the state free speech clause would limit private conduct. The reasoning is that the phrase likely was intended to preserve common law defamation actions for abusive speech, with the corollary that non abusive speech “should not be suppressed by a private suit for injunctive or damage relief. This, then, is evidence of awareness that the constitution could not only shield conduct (nondefamatory speech) from civil liability but also limit other private conduct (damage suits for nondefamatory speech). . . . At the very least, its inclusion in 1849 supports the argument that the document’s drafters . . . did not have a fixed notion that only the conduct of public actors could be affected by constitutional guarantees.” (Private [370] vote Actors, supra, 17 Hastings Const. L.Q. at p. 122.)

Third, were it accurate that the framers “`feared only government intrusions'” (lead opn., ante, 111 Cal.Rptr.2d at p. 344, 29 P.3d at p. 804), the proffered conclusion—that in drafting the state free speech clause as a whole the framers “intended to impose a state action requirement” (id. at p. 345, 29 P.3d at p. 805)—would not follow, for, as the lead opinion itself notes, the framers, regardless of what type of intrusion they feared most, evidently also “`wished to declare generally the sanctity of free expression'” (id. at p. 344, 29 P.3d at p. 804) as against the world. (See also Gerawan, supra, 24 Cal.4th at pp. 492-193, 101 Cal.Rptr.2d 470, 12 P.3d 720.) The language they employed does just that.

Plain English is not ambiguous unless “there are two meanings which may reasonably be attributed to the term in question.” (Reserve Insurance Co. v. Pisciotta(1982) 30 Cal.3d 800, 815, 180 Cal.Rptr. 628, 640 P.2d 764 [contract provision]; see also Davis v. City of Berkeley (1990) 51 Cal.3d 227, 235, 272 Cal.Rptr. 139, 794 P.2d 897 [constitutional provision].) Applying this fundamental principle of construction, we previously have held that a constitutional liberty conferred without qualification is neither “`ambiguous or doubtful'” in scope but, rather, “`applies to all . . . substantial . . . impair[ments]'” of the right conferred and “`is not aimed solely at'” (Meriwether Invest. Co., Ltd. v. Lampton (1935) 4 Cal.2d 697, 703, 53 P.2d 147) any subset thereof. (See also Welsh v. Cross (1905) 146 Cal. 621, 624, 81 P. 229.)^[FN.12]Ultimately, the same principle applies here. In light of its unqualified statement of the free speech right, section 2(a) is not susceptible of being construed as applicable only against state or state-like action.

In short, the lead opinion fails to demonstrate that, despite its plain language and contrary to our pronouncements in Robins and Gerawan, section 2(a) contains ambiguities regarding state action the resolution of which requires recourse to extrinsic sources concerning the framers’ intent. But even were such ambiguities present, I would conclude, based on section 2(a)’s history and context, that—asRobins impliedly held and Gerawan confirmed—our Constitution grants a free speech right running against private parties as well as state actors.

The state free speech clause first appeared as article I, section 9 of the original California Constitution of 1849: “Every citizen may freely speak, write, and publish his sentiments on all subjects, being responsible for the abuse of that right; and no law shall be passed to restrain or abridge the liberty of speech or of the press. In all criminal prosecutions . . . for libels, the truth may be given in evidence to the jury; and if it shall appear to the jury that the matter charged as libelous is true, and was published with good motives and for justifiable ends, the party shall be acquitted; and the jury shall have the right to determine the law and the fact.” (Cal. Const, of 1849, art. I, § 9.)

The clause next appeared as article I, section 9 of the present California Constitution of 1879. It was identical to its [371] predecessor but for the addition of a sentence further relating to criminal libel. (See Cal. Const., art. I, former § 9, as adopted May 7, 1879.)^[FN.13] In 1974, the clause was revised by the addition of new section 2 to article I and the deletion of old section 9: “Every person may freely speak, write and publish his or her sentiments on all subjects, being responsible for the abuse of this right. A law may not restrain or abridge liberty of speech or press.” (Cal. Const., art. I, § 2, added Nov. 5, 1974.) ^[FN.14] Finally, the clause was redesignated in 1980 as article I, section 2, subdivision (a).

Thus, like the present clause, the state free speech clause as originally drafted drew no distinction between state actors and private parties, impliedly therefore granting a free speech right that runs against both. Also like the present clause, the original clause expressly noted speakers’ responsibility for “abuse” of the free speech right, language that—to the extent it may be read as preserving the right of aggrieved private parties to sue for defamation (see Lundquist v. Reusser (1994) 7 Cal.4th 1193, 1203, 31 Cal.Rptr.2d 776, 875 P.2d 1279)—the lead opinion’s proffered state action requirement would render superfluous.

Examination of the constitutional context of the original state free speech clause, as originally enacted and as it appears today, buttresses the conclusion that it grants a right of free speech running against private parties as well as state actors. Enacted together with the free speech clause in the Constitution of 1849 was a clause that granted to wives a separate property right as against their husbands, who were obviously private parties. (Cal. Const, of 1849, art. XI, § 14.) This separate-property clause clearly illustrates that the free speech clause was not unique, in 1849, in granting rights against private parties as well as state actors.

Today the state free speech clause appears in the same article as the privacy clause: “All people are by nature free and independent and have inalienable rights. Among these [is] . . . privacy.” (Cal. Const., art. I, § 1.) The right of free speech and the right of privacy complement each other, the former dealing with communication to others (see Spiritual Psychic Science Church v. City of Azusa (1985) 39 Cal.3d 501, 510-511, 217 Cal. Rptr. 225, 703 P.2d 1119 [implying speech “communicates a message” from speaker to audience]), the latter dealing both with conduct apart from others and information kept from others (see Nahrstedt v. Lakeside Village Condominium Assn. (1994) 8 Cal.4th 361, 387, 33 Cal. Rptr.2d 63, 878 P.2d 1275;Hill v. National Collegiate Athletic Assn., supra, 7 Cal.4th at pp. 35-36, 26 Cal.Rptr.2d 834, 865 P.2d 633). Just as the right of privacy runs against private parties as well as state actors (Hill v. National Collegiate Athletic Assn., supra, 7 Cal.4th at pp. 15-20, 26 Cal.Rptr.2d 834, 865 P.2d 633), so [372] too, as demonstrated, runs the right of free speech.

Given that the history and context of the California free speech provision sufficiently confirm its meaning, any excursion into the history of the New York Constitution from which the clause derived is unnecessary. Nor is the relevance of that history clear. The lead opinion posits no evidence that the framers of California’s Constitution were aware of or indeed intended to adopt those aspects of the New York history that relate to state action. Nor does it persuade that the framers of the New York Constitution “intended its free speech clause `to serve as a check on governmental, not private, conduct.'” (Lead opn., ante, 111 Cal.Rptr.2d at p. 345, 29 P.3d at p. 805.) The authorities underlying SHAD Alliance v. Smith Haven Mall (1985) 66 N.Y.2d 496, 498 N.Y.S.2d 99, 488 N.E.2d 1211, cited by the lead opinion, as well as the lead opinion’s other authorities, tend upon examination to support only the first half of that claim, i.e., that the New York framers wished to guard against government encroachments on speech, not the latter half, i.e., that they wished not to guard against private encroachments. (See, e.g., SHAD Alliance, supra, 66 N.Y.2d at p. 502, 498 N.Y.S.2d 99, 488 N.E.2d 1211 [citing various scholars for the truism that “a Bill of Rights is designed to protect individual rights against the government”].) One commentator, noting that the New York “minutes do not reveal why the delegates chose to declare an open-ended right rather than simply to prohibit oppressive `laws,'” reasons that “perhaps [the broader language] was more attractive precisely because it secured a precious liberty against the entire world.” (Private Actors, supra, 17 Hastings Const. L.Q. at p. 120.)

Finally, whatever the decisions of most of our sister courts (see lead opn., ante, 111 Cal.Rptr.2d at p. 349, 29 P.3d at p. 808, what matters is the meaning of California’sfree speech clause. Any assertion that there exists a uniform and unchanging “American constitutional theory” (lead opn., ante, at p. 349, 29 P.3d at p. 808) is not supportable. (See generally Baum & Fritz, American Constitution-Making: The Neglected State Constitutional Sources (2000) 27 Hastings Const. L.Q. 199, 199-201; Fritz, The American Constitutional Tradition Revisited: Preliminary Observations on State Constitution-Making in the Nineteenth-Century West (1994) 25 Rutgers L.J. 945, 952-956, 964-971.)

Ultimately, neither the text of the state free speech clause, the history of its adoption, our prior pronouncements, nor considerations of constitutional theory supports judicial imposition of a state action limitation on Californians’ free speech rights. Consequently, I join with the Chief Justice in rejecting the lead opinion’s discussion and conclusions with regard to the state action doctrine (cone, opn., ante, 111 Cal.Rptr.2d at p. 354, 29 P.3d at p. 812) and would adhere to our traditional understanding that, even when a restriction on speech “does not implicate any right to freedom of speech under the First Amendment, [it may nevertheless] implicate such a right under [California’s free speech clause]” (Gerawan, supra, 24 Cal.4th at p. 476, 101 Cal.Rptr.2d 470, 12 P.3d 720).

III.

Regrettably, four justices of this court join today in denying constitutional protection to the tenant speech at issue here. The concurring opinion, like the lead opinion, emphasizes that Golden Gateway’s premises are not open to the public. To that extent, I agree this case is different from Robins factually. I disagree the distinction is dispositive. Rather, that the owner of private property may exclude [373] members of the general public from entry onto the premises without necessarily implicating their free speech rights says little about the rights of those who are lawful members of a community occupying units of the property as their residences.

Both opinions, moreover, overlook a critical respect in which this case is factuallysimilar to Robins: The private property owner seeking to restrict speech already has for its own purposes surrendered to those whose speech it would restrict much of its interest in retaining exclusive control over the premises. Golden Gateway seeks to enjoin tenant speech (as the owners of the shopping center in Robins sought to restrict some patrons’ speech), but it already has surrendered to tenants, for virtually the entire range of activities and uses associated with daily living, the hallways and other common areas of the building. Similarly, as the lead and concurring opinions acknowledge, the owners of the shopping center in Robins had “invited [the public] to visit for the purpose of patronizing the many businesses” (Robins, supra, 23 Cal.3d at p. 902, 153 Cal.Rptr. 854, 592 P.2d 341).

The concurring opinion concludes that the tenant speech Golden Gateway’s leafleting ban would affect lies outside “the appropriate limit of th[e] substantive right of free speech” (cone, opn., ante, 111 Cal. Rptr.2d at p. 354, 29 P.3d at p. 812). But contrary to the concurring opinion, Golden Gateway’s ban is not a “`reasonable regulation, by an owner, of conduct inside [its] multiple dwelling'” (id. at p. 354, 29 P.3d at p. 812, quoting Watchtower Bible & Tract Soc, Inc. v. Metropolitan Life Ins. Co. (1948) 297 N.Y. 339, 79 N.E.2d 433, 436-437, italics in cone. opn. omitted). As explained above, the ban goes much further than is necessary to address any legitimate concerns Golden Gateway may have about tenant safety, tenant privacy, or cleanliness of the premises.

With the concurring opinion, therefore, I reject a view of our state free speech clause that “effectively would remove any state constitutional obstacle to any . . . action by a landlord, union, or employer” implicating an individual’s core free speech rights. (Cone, opn., ante, 111 Cal.Rptr.2d at p. 360, 29 P.3d at p. 816.) But I also reject the concurring opinion’s approach, which would do much the same with respect to published communications, despite their constitutionally equal—and traditionally cherished—status in this state as protected expressive activity.

Conclusion

For the foregoing reasons, I would reverse the judgment of the Court of Appeal.

KENNARD, J., and KLEIN, J.^[FN.*], concur.

[FN.1] All further undesignated article references are to the California Constitution unless otherwise indicated.

[FN.2] The First Amendment of the United States Constitution states in relevant part: “Congress shall make no law . . . abridging the freedom of speech

[FN.3] In holding that high school students had a state constitutional right to solicit signatures in a privately owned shopping center, Robins weighed the students’ right to free speech against the property rights of the owner of the shopping center. (Robins, supra, 23 Cal.3d at pp. 910-911, 153 Cal.Rptr. 854, 592 P.2d 341.) Robins did not, however, consider the free speech rights of the owner under the California Constitution. (See Gerawan Farming, Inc. v. Lyons (2000) 24 Cal.4th 468, 513, 101 Cal.Rptr.2d 470, 12 P.3d 720 (Gerawan) [holding that California’s free speech clause grants “a right to refrain from speaking at all as well as a right to speak freely”].) We express no opinion here as to the role of these rights in ascertaining the scope of free speech rights guaranteed by article I, section 2, subdivision (a).

[FN.4] (See, e.g., Friedelbaum, Private Property, Public Property: Shopping Centers and Expressive Freedom in the States (1999) 62 Alb. L.Rev. 1229, 1239 (Private Property, Public Property) [“It is difficult to understand how a threshold issue [state action] of such importance could have been overlooked except for the fervency of both federal and state courts to attain other objectives” (fn.omitted) ]; Kelso, California’s Constitutional Right to Privacy (1992) 19 Pepperdine L.Rev. 327, 413 (California’s Right to Privacy) [“the court in Pruneyard does not resolve whether the free speech clause applies to all private conduct which burdens speech or only to private conduct imbued with public elements sufficient to trigger the protections of the Declaration of Rights”]; Pruning Pruneyard, supra, 24 U.C. Davis L.Rev. at pp. 1090, 1092 [expressing surprise at Robins’s failure to address the state action issue and noting other analytical problems]; Devlin, Constructing an Alternative to “State Action” as a Limit on State Constitutional Rights Guarantees: A Survey, Critique and Proposal (1990) 21 Rutgers L.J. 819, 832 (Constructing an Alternative) [“the [Robins ] court was less explicit about its reasons for applying the state constitution . . . [and] did not clarify whether it rejected a state action requirement or simply broadened the federal definition of `state action’ to embrace the peculiar facts of the case” (fn.omitted) ]; Simon, Independent but Inadequate: State Constitutions and Protection of Freedom of Expression (1985) 33 U.Kan. L.Rev. 305, 325-336 (State Constitutions and Protection of Freedom of Expression) [“The Pruneyard court did not explain why this [free speech] burden applied to private parties . . . [and] did not attempt to delineate the scope of California’s affirmative right of freedom of expression”]; Comment, State Constitutional Rights of Free Speech on Private Property: The Liberal Loophole (1982/1983) 18 Gonz. L.Rev. 81, 94 (State Constitutional Rights of Free Speech ) [“The California Supreme Court in Robins, however, never expressly rejected this [state action] prerequisite and in fact simply avoided the issue”]; Comment, Transforming the Privately Owned Shopping Center into a Public Forum: Pruneyard Shopping Center v. Robins (1981) 15 U.Rich. L.Rev. 699, 720 [Robins is “confusingly broad” (fn.omitted) ]; Note, Robins v. Pruneyard Shopping Center: Free Speech Access to Shopping Centers Under the California Constitution (1980) 68 Cal. L.Rev. 641, 645 (Free Speech Access to Shopping Centers) [suggesting that the court was not prepared to address the state action issue in Robins ]; but see, e.g., Ragosta, Free Speech Access to Shopping Malls Under State Constitutions: Analysis and Rejection (1986) 37 Syracuse L.Rev. 1, 21 (Free Speech Access to Shopping Malls) [observing that “only California has completely and clearly rejected a state action limitation upon free speech” (fn.omitted) ]; Utter, The Right to Speak, Write, and Publish Freely: State Constitutional Protection Against Private Abridgment (1985) 8 U. Puget Sound L.Rev. 157, 169 [“Although the [Robins ] court did not expressly state that the California Constitution had no state action requirement, the Washington court has interpreted Robins as impliedly abandoning any state action requirement for the California Constitution” (fn.omitted)].)

[FN.5] (See, e.g., Fiesta Mall Venture v. Mecham Recall Committee (App.1988) 159 Ariz. 371, 767 P.2d 719, 724 (Fiesta Mall Venture) [finding no state constitutional right to free speech in a privately owned shopping center]; Cologne v. Westfarms Assocs. (1984) 192 Conn. 48, 469 A.2d 1201, 1210 (Cologne) [same]; Cahill v. Cobb Place Associates (1999) 271 Ga. 322, 519 S.E.2d 449, 450-451 (Cahill) [same]; Eastwood Mall, Inc. v. Slanco (1994) 68 Ohio St.3d 221, 626 N.E.2d 59, 61-62 (Eastwood Mall) [same]; Woodland v. Michigan Citizens Lobby (1985) 423 Mich. 188, 378 N.W.2d 337, 358 (Woodland) [same]; Minnesota v. Wicklund (Minn. 1999) 589 N.W.2d 793, 802 (Wicklund)[same]; S.O.C., Inc. v. Mirage Casino-Hotel (Nev.2001) 23 P.3d 243, 250 (S.O.C.) [declining to adopt the rationale of Robins ]; SHAD Alliance v. Smith Haven Mall (1985) 66 N.Y.2d 496, fn. 5, 498 N.Y.S.2d 99, 102, 488 N.E.2d 1211, 1214 (SHAD Alliance) [finding no state constitutional right to free speech in a privately owned shopping center]; Southcenter loint Venture v. National Democratic Policy Com. (1989) 113 Wash.2d 413, 780 P.2d 1282, 1292 (Southcenter Joint Venture) [same];Jacobs v. Major (1987) 139 Wis.2d 492, 407 N.W.2d 832, 841 (Jacobs) [same]; but see Bock v. Westminster Mall Co. (Colo. 1991) 819 P.2d 55, 61-63 [finding a state constitutional right to leaflet in a privately owned shopping center]; New Jersey Coalition Against War v. J.M.B. Realty Corp. (1994) 138 N.J. 326, 650 A.2d 757, 780 (New Jersey Coalition Against War) [same].) Various state courts have also held that a state constitutional provision concerning the right to petition does not protect the solicitation of signatures in a privately owned shopping center. (See, e.g., Stranahan v. Fred Meyer, Inc. (2000) 331 Or. 38, 11 P.3d 228, 243 [finding no state constitutional right to petition in a privately owned shopping center]; Citizens for Ethical Gov. v. Gwinnett (1990) 260 Ga. 245, 392 S.E.2d 8, 9-10[same]; but see Batchelder v. Allied Stores Intern., Inc. (1983) 388 Mass. 83, 445 N.E.2d 590, 595[finding a state constitutional right to solicit signatures in a privately owned shopping center pursuant to a clause in the Massachusetts Constitution concerning freedom and equality of elections].)

[FN.6] (See, e.g., Eule & Varat, Transporting First Amendment Norms to the Private Sector: With Every Wish There Comes a Curse (1998) 45 UCLA L.Rev. 1537; Chemerinsky, More Speech is Better(1998) 45 UCLA L.Rev. 1635; Varat, When May Government Prefer One Source of Private Expression Over Another? (1998) 45 UCLA L.Rev. 1645; Pruning Pruneyard, supra, 24 U.C. Davis L.Rev. 1073; Friesen, Should California’s Constitutional Guarantees of Individual Rights Apply Against Private Actors? (1989) 17 Hastings Const. L.Q. 111 (Private Actors ); Sundby, Is Abandoning State Action Asking Too Much of the Constitution? (1989) 17 Hastings Const.L.Q. 139; Free Speech Access to Shopping Centers, supra, 68 Cal. L.Rev. 641; Free Speech Access to Shopping Malls, supra, 37 Syracuse L.Rev. 1; Cohen, Pruneyard Shopping Center v. Robins: Past, Present and Future (1981) 57 Chi.-Kent L.Rev. 373 (Pruneyard Shopping Center).)

[FN.7] (See 5 Thorpe, The Federal and State Constitutions (1909) pp. 2648, 2654; see also Reiner & Size, The Law Through a Looking Glass: Our Supreme Court and the Use and Abuse of the California Declaration of Rights (1992) 23 Pacific L.J. 1183, 1197 [“In order to appreciate the intellectual origins of our California Declaration of Rights, it is necessary to understand, first, that it was the 1846 New York Constitution . . . which our delegates were looking at in Monterey in 1849. Second, the provisions of the 1846 bill of rights for the most part trace their language to the 1821 constitution”].)

[FN.8] (See Private Property, Public Property, supra, 62 Alb. L.Rev. at pp. 1238-1239; California’s Right to Privacy, supra, 19 Pepperdine L.Rev. at p. 413; Pruning Pruneyard, supra, 24 U.C. Davis L.Rev. at p. 1090; Constructing an Alternative, supra, 21 Rutgers L.J. at p. 832; A Terrible Beauty, supra, 9 Whittier L.Rev. at p. 731; State Constitutional Rights of Free Speech, supra, 18 Gonz. L.Rev. at pp. 94-95; Free Speech Access to Shopping Centers, supra, 68 Cal. L.Rev. at p. 645; see also Laguna Publishing, supra, 131 Cal.App.3d at p. 838, 182 Cal.Rptr. 813 [declining to interpret Robins as rejecting a state action limitation].)

[FN.9] (See, e.g., Fiesta Mall Venture, supra, 767 P.2d at p. 723 [holding that the state free speech clause did not restrain private conduct]; Cologne, supra, 469 A.2d at p. 1209 [same]; Cahill, supra, 519 S.E.2d at p. 450 [same]; State v. Lacey (Iowa 1991) 465 N.W.2d 537, 540 [same]; Eastwood Mall, supra, 626 N.E.2d at p. 61 [same]; People v. DiGuida (1992) 152 Ill.2d 104, 178 Ill.Dec. 80, 604 N.E.2d 336, 344 [same]; Woodland, supra, 378 N.W.2d at p. 348 [same]; Wicklund, supra, 589 N.W.2d at p. 801 [same]; S.O.C., supra, 23 P.3d at p. 251 [same]; SHAD Alliance, supra, 498 N.Y.S.2d 99, 488 N.E.2d at p. 1214, fn. 5 [same]; Western Pennsylvania Socialist Workers v. Connecticut General Life Ins. Co. (1986) 512 Pa. 23, 515 A.2d 1331, 1335 [same]; Southcenter Joint Venture, supra, 780 P.2d at p. 1292 [same]; Jacobs, supra, 407 N.W.2d at p. 841 [same]; but see New Jersey Coalition Against War, supra, 650 A.2d at p. 771 [holding that “the State right of free speech is protected . . . from unreasonably restrictive and oppressive conduct by private entities”].)

[FN.10] Contrary to the dissent’s characterization (see dis. opn., post, 111 Cal.Rptr.2d at p. 372, 29 P.3d at p. 827), Chief Justice George expressly declines to reach the state action question and expresses no opinion as to whether California’s free speech clause requires state action (see cone, opn., post,111 Cal.Rptr.2d at p. 359, 29 P.3d at p. 816).

[FN.11] (See Diamond I, supra, 3 Cal.3d at p. 661, 91 Cal.Rptr. 501, 477 P.2d 733 [relying on the First Amendment and Logan Valley ]; In re Lane (1969) 71 Cal.2d 872, 878, 79 Cal.Rptr. 729, 457 P.2d 561 (Lane) [same]; In re Hoffman (1967) 67 Cal.2d 845, 849-850, 64 Cal. Rptr. 97, 434 P.2d 353 (Hoffman) [relying on the First Amendment and Marsh ]; Schwartz-Torrance Investment Corp. v. Bakery & Confectionery Workers’ Union (1964) 61 Cal.2d 766, 771, 40 Cal.Rptr. 233, 394 P.2d 921 (Schwartz-Torrance) [relying on Marsh and other First Amendment precedents].)

[FN.12] (See Diamond II, supra, 11 Cal.3d 331, 342-343, 113 Cal.Rptr. 468, 521 P.2d 460 (dis. opn. of Mosk, J.) [emphasizing the publie’s unrestricted access to the shopping center]; Diamond I, supra, 3 Cal.3d at pp. 659-660, 91 Cal.Rptr. 501, 477 P.2d 733 [same]; Lane, supra, 71 Cal.2d at pp. 877-878, 79 Cal.Rptr. 729, 457 P.2d 561 [emphasizing the public nature of the sidewalk and store]; Hoffman, supra, 67 Cal.2d at pp. 847, 851, 64 Cal.Rptr. 97, 434 P.2d 353 [emphasizing that the railway station was open to the public and contained a “spacious area” with numerous retail establishments where the public could and would congregate]; Schwartz-Torrance, supra, 61 Cal.2d at pp. 768, 772, 40 Cal.Rptr. 233, 394 P.2d 921 [emphasizing the public nature of the shopping center].)

[FN.13] Consequently, we do not reach the issue of whether Golden Gateway’s ban on leafletting is a reasonable time, place and manner restriction on free speech.

[FN.14] (See, e.g., Linn Valley Lakes Property Owners Assn. v. Brockway (1992) 250 Kan. 169, 824 P.2d 948, 951 [judicial enforcement of a constitutionally permissible restrictive covenant is not state action];Midlake on Big Boulder Lake v. Cappuccio (1996) 449 Pa.Super. 124, 673 A.2d 340, 342 [same];Washington v. Noah (2000) 103 Wash.App. 29, 9 P.3d 858, 870 [judicial enforcement of a voluntary settlement agreement is not state action]; cf. CompuServe Inc. v. Cyber Promotions, Inc. (S.D.Ohio 1997) 962 F.Supp. 1015, 1026 [“the mere judicial enforcement of neutral trespass laws by the private owner of property does not alone render it a state actor”]; Commonwealth v. Hood (1983) 389 Mass. 581, 452 N.E.2d 188, 193 [judicial enforcement of neutral trespass statute is not state action]; but see Franklin v. White Egret Condominium (Fla.Dist.Ct.App. 1977) 358 So.2d 1084, 1087-1088 [finding enforcement of a restrictive covenant barring children under the age of 12 unconstitutional], affd. by White Egret Condominium v. Franklin (Fla. 1979) 379 So.2d 346; West Hill Baptist Church v. Abbate(Common Pleas 1969) 24 Ohio Misc. 66, 261 N.E.2d 196, 200 [judicial enforcement of restrictive covenant excluding houses of worship constitutes state action].)

[FN.1] The court observed: “The more an owner, for his advantage, opens up his property for use by the public in general, the more do his rights become circumscribed by the statutory and constitutional rights of those who use it. [Citation.] Thus, the owners of privately held bridges, ferries, turnpikes and railroads may not operate them as freely as a farmer does his farm. Since these facilities are built and operated primarily to benefit the public and since their operation is essentially a public function, it is subject to state regulation.” (Marsh, supra, 326 U.S. at p. 506, 66 S.Ct. 276.)

[FN.2] The high court reversed Logan Valley in Hudgens v. National Labor Relations Bd. (1976) 424 U.S. 507, 96 S.Ct. 1029, 47 L.Ed.2d 196.

[FN.3] The court in Batchelder observed: “We are not discussing signature solicitations in stores but only unobtrusive and reasonable solicitations in the common areas of the mall, areas that have been dedicated to the public as a practical matter.” (Batchelder, supra, 445 N.E.2d at p. 595, italics added.)

[FN.4] In Southcenter v. National Dem. Policy Comm. (1989) 113 Wash.2d 413, 780 P.2d 1282, 1290, the Washington Supreme Court subsequently reaffirmed this aspect of Aiderwood, while at the same time rejecting other facets of that decision.

[FN.5] Decisions upholding a right to distribute pamphlets door-to-door (e.g., Martin v. City of Struthers(1943) 319 U.S. 141, 63 S.Ct. 862, 87 L.Ed. 1313; Van Nuys Pub. Co. v. City of Thousand Oaks(1971) 5 Cal.3d 817, 97 Cal. Rptr. 777, 489 P.2d 809) recognize that unless the occupant of a dwelling announces a desire not to receive unsolicited material, members of the general public are permitted to traverse a private walkway, and leave pamphlets on or near any dwelling door that is located in an area not closed to the general public. Accordingly, in situations contemplated in those decisions, unlike the present case, the area leading to and immediately surrounding the door is notclosed to the general public.

Laguna Publishing Co. v. Golden Rain Foundation (1982) 131 Cal.App.3d 816, 182 Cal.Rptr. 813(Laguna Publishing Co.) is distinguishable from the present case. In that case, a newspaper publisher was barred by the homeowners association of a private gated community from entering the community and depositing unsolicited copies of its free newspaper at the doors of the residents of the community. At the same time, the association permitted another newspaper publisher to deliver its competing free and unsolicited newspaper to the doors of the community residents. The excluded publisher sued in order to establish its right to distribute on an equal footing with the preferred publisher. Although the Court of Appeal found that the excluded publisher had a right under article 2(a) to distribute its newspapers to the doors of the community residents on an equal basis with the other publisher, that court’s decision rested upon the discriminatory nature of the challenged policy. (See Laguna Publishing Co., supra, at pp. 840-845, 182 Cal.Rptr. 813.) The Court of Appeal in Laguna Publishing Co. concluded that the dispute presented was “purely and simply a discrimination case with substantial economic consequences,” and “not one truly involving the resolution of rights of free speech in conflict with the vested rights of private property.” (Id., at pp. 847-848, fn. 14, 182 Cal.Rptr. 813.)

[FN.1] In its entirety, section 2(a) provides: “Every person may freely speak, write and publish his or her sentiments on all subjects, being responsible for the abuse of this right. A law may not restrain or abridge liberty of speech or press.”

[FN.2] The lead opinion suggests that the justices in Gerawan‘s majority “did not carefully consider whether California’s free speech clause requires state action” (lead opn., ante, 111 Cal.Rptr.2d at p. 348, 29 P.3d at p. 807) when they stated that it “runs against the world, including private parties” (Gerawan, supra, 24 Cal.4th at p. 492, 101 Cal.Rptr.2d 470, 12 P.3d 720), but that the statement may have been dictum does not mean it was ill considered. As explained above, moreover, and contrary to the lead opinion’s further assertion, the Gerawan majority provided ample analytical support (lead opn., ante, at p. 348, 29 P.3d at p. 807) for its statement.

[FN.3] Actually, the private property involved in Robins, contrary to the lead opinion’s implication, was not open to the public without qualification, but only at certain times and “for the purpose of patronizing the many businesses.” (Robins, supra, 23 Cal.3d at p. 902, 153 Cal.Rptr. 854, 592 P.2d 341.)

[FN.4] See, e.g., Aguilar v. Avis Rent A Car System, Inc. (1999) 21 Cal.4th 121, 166, 87 Cal. Rptr.2d 132, 980 P.2d 846 (cone. opn. of Werdegar, J.) (“[b]alancing . . . First Amendment free speech rights with the equally weighty right of plaintiffs to be let alone at their jobsite, free of racial discrimination”);Sommer v. Metal Trades Council (1953) 40 Cal.2d 392, 401-402, 254 P.2d 559 (noting the “`effort in the cases has been to strike a balance between the constitutional protection of the element of communication in picketing and “the power of the State to set the limits of permissible contest open to industrial combatants”‘”); Gill v. Hearst Publishing Co. (1953) 40 Cal.2d 224, 228, 253 P.2d 441(holding the “right `to be let alone’ and to be protected from undesired publicity is not absolute but must be balanced against the public interest in the dissemination of news and information consistent with the democratic processes under the constitutional guaranties of freedom of speech and of the press”).

[FN.5] Martin v. City of Struthers, supra, 319 U.S. 141, 63 S.Ct. 862, 87 L.Ed. 1313 and Van Nuys, supra, 5 Cal.3d 817, 97 Cal.Rptr. 777, 489 P.2d 809 both were cases decided in the First Amendment context, but the free speech interests they involved were similar to those with which this case deals. “As a general rule, [moreover, California’s] free speech clause and its right to freedom of speech are not only as broad and as great as the First Amendment’s, they are even `broader’ and `greater.'” (Gerawan, supra, 24 Cal.4th at p. 491, 101 Cal.Rptr.2d 470, 12 P.3d 720, citing numerous authorities.)

[FN.6] The assumption may be faulty. The current version of Golden Gateway’s ban, the first expressly to prohibit “leafleting,” was promulgated shortly after the Tenants Association distributed flyers criticizing Golden Gateway’s management and discussing a Tenants Association lawsuit against Golden Gateway. The record, moreover, suggests that Golden Gateway construes its ban as not restricting itsown communicative prerogatives.

[FN.7] But such communication is not without restriction. Under the Building Standards’ solicitation ban, tenants may not even speak with each other in the common areas of the building if to solicit membership in the Tenants Association, engage in religious proselytizing, distribute campaign literature, seek political or charitable contributions, or, indeed, seek support for causes of any kind.

[FN.8] While Golden Gateway’s property managers testified in general terms to tenant concern about leafleting, the record reveals that Golden Gateway ultimately could document only one resident complaint about door-to-door leafleting in over 15 years.

[FN.9] This is not to say, of course, that free speech rights, when implicated, always must prevail over competing considerations. As we observed in Robins, for example, appropriate constitutional balancing of free speech interests against “`the property or privacy rights of an individual homeowner or the proprietor of a modest retail establishment'” (Robins, supra, 23 Cal.3d at p. 910, 153 Cal.Rptr. 854, 592 P.2d 341) might come out differently.

[FN.10] Golden Gateway’s ban does not distinguish between, and is not tailored separately to address, commercial and noncommercial speech. Moreover, Golden Gateway’s Building Standards by their terms bar, and the injunction Golden Gateway seeks would burden, only tenant speech. We need not decide, therefore, what result an appropriate balancing of constitutional considerations would generate in a case implicating only commercial or only nontenant speech.

[FN.11] For convenience, the discussion that follows occasionally employs the lead opinion’s apparent shorthand expression “state action” for the “state or state-like action” limitation on state free speech rights the lead opinion would impose. As will appear, however, I disagree that Robins stands for the proposition that “private property must be public in character before California’s free speech clause may apply” (lead opn., ante, 111 Cal. Rptr.2d at pp. 351-352, 29 P.3d at pp. 809-810). Still less am I willing to embrace the logically incoherent notion that “the actions of a private property owner constitute state action . . . if the property is freely and openly accessible to the public” (id. at p. 352, 29 P.3d at p. 810).

[FN.12] Specifically, in Meriwether we held that, in forbidding any “`”law impairing the obligation of contract,”‘” former article I, section 16 of the California Constitution plainly was “`not aimed solely at laws which expressly destroy or annul contracts.'” (Meriwether Invest. Co., Ltd. v. Lampton, supra, 4 Cal.2d at p. 703, 53 P.2d 147.) In Welsh, we reasoned that, as that clause by its terms “is not aimed solely at” laws which expressly annul contracts, it “applies to all laws which in any substantial degree” have that effect. (Welsh v. Cross, supra, 146 Cal. at p. 624, 81 P. 229.)

[FN.13] The additional sentence read: “Indictments found, or information laid, for publications in newspapers shall be tried in the county where such newspapers have their publication office, or in the county where the party alleged to be libeled resided at the time of the alleged publication, unless the place of trial shall be changed for good cause.” (Cal. Const., art. I, former § 9, as adopted May 7, 1879.)

[FN.14] This revision retained, without substantial change, the state free speech clause at its core and removed the provisions relating to procedure in prosecutions for criminal libel as more suited to statute than constitution. (See Ballot Pamp., Gen. Elec. (Nov. 5, 1974) analysis of Prop. 7 by Legis. Analyst, p. 26.)

[FN.*] Presiding Justice of the Court of Appeal, Second Appellate District, Division Three, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.

Bear Creek Master Association v. Edwards

(2005) 31 Cal.Rptr.3d 337

[Duty to pay; Assessment Liens] A recorded assessment lien secures the assessment debt that continues to accrue on the owner’s account; the debt is not limited solely to the amount stated in the lien at the time the lien was initially recorded.

Law Office of Lucia Enriquez and Lucia Enriquez; Quinn Emanuel Urquhart Oliver & Hedges, and John S. Gordon, Los Angeles, attorneys for Defendants and Appellants.
Fiore, Racobs & Powers, Peter E. Racobs and Michelle A. Buchmeier, Palm Desert, attorneys for Plaintiff and Respondent.

Certified for Partial Publication.^[FN.*]

OPINION

WARD, J.

Defendants and appellants Parlan L. Edwards and Gloria Renico Edwards, as trustees of the Parlan L. Edwards and Gloria Renico Edwards Family Trust (the Trust), appeal from a judgment in favor of plaintiff and respondent Bear Creek Master Association (Bear Creek), on Bear Creek’s action for breach of contract and foreclosure. Although both Edwardses are named trustees of the trust, the primary actor throughout has been Parlan L. Edwards; for convenience, therefore, we refer to “Edwards” in the singular, as the representative of the Trust and as the person who performed most of the salient acts on defendants’ behalf.

Edwards and the Trust also appeal postjudgment orders for attorney fees and requiring them to post additional security pending appeal.

The key issue in the appeal is whether a homeowners’ association may charge homeowners’ association dues or assessments for unbuilt property within a planned and partially built homeowners’ association development. The Trust’s parcel was planned for eight condominium units, out of a phase of sixteen, but none of the units on the Trust’s portion of the property had actually been constructed. This dispute arose because the Trust failed to pay homeowners’ association assessments; indeed, it refused to do so on the theory that assessments are chargeable only to a “condominium unit,” but that there were no built-out “units” on the Trust’s property.

As we shall explain below, we affirm the judgment and the postjudgment orders.

FACTS AND PROCEDURAL HISTORY

Bear Creek is the master homeowners’ association for the master Bear Creek development. Country Club Villas (CCV) is the homeowners’ association, or subassociation, within the Bear Creek master development. The property at issue is located within the CCV subassociation area within the Bear Creek master development. The property comprises what is described as units 9-16 of Phase IV of the Country Club Villas subassociation. Units 9-16 were eight unbuilt condominium units within CCV Phase IV. Sixteen condominiums were originally designed for CCV Phase IV; eight condominiums were built in “pods” of two units each, but the remaining eight units, comprising units 9-16, were never constructed.

A company called Watt Bear Creek had owned units 9-16 of CCV Phase IV, but lost title to that property through foreclosure. The property was acquired by Bear Creek Limited, which was owned by Bill Johnson. Edwards apparently lent a sum of money to Johnson, which Johnson failed to repay.

At the time that Edwards lent the funds to Johnson, he did not further investigate the status of Johnson’s property; he simply relied on Johnson’s representation that the property was worth twice the amount borrowed. He did no research in the Riverside County Assessor’s Office, he did not research recorder’s office records regarding the property, and he never read the Bear Creek CC & R’s applicable to the property. Edwards testified that he had purchased numerous properties in the past and that he was familiar with title reports, [341] but that he did not review any title report on the property before lending to Johnson.

Johnson defaulted on the Edwards loan, and Edwards foreclosed. Again, before foreclosing and taking title to the property, Edwards did not check the assessor’s records, did not check the recorder’s records, and did not obtain a title report. Edwards foreclosed on the property and took title for the Trust in approximately December 1997. Edwards’s attorney, Lucila Enriquez, telephoned the Bear Creek property manager in January 1998 to explain that Edwards was now the owner of units 9-16 of CCV Phase IV. Attorney Enriquez told the property manager that she was representing Edwards in connection with his ownership of the lots, and advised that she and Edwards had had some difficulty accessing the property. She followed up the telephone conversation with a copy of the title document showing the transfer from Johnson to Edwards.

The deed giving title to Edwards, on behalf of the trust, listed attorney Enriquez’s address as the address to which the recorded deed was to be mailed. It was to attorney Enriquez’s address, therefore, that Bear Creek sent various notices to Edwards, as owner of units 9-16 of CCV Phase IV.

Among other things, Bear Creek mailed homeowners’ association ballots and notices of association assessments to Edwards, always to attorney Enriquez’s address. As already noted, attorney Enriquez herself had telephoned Bear Creek’s property manager in January of 1998 to inform Bear Creek that the Trust had acquired ownership of the property. The homeowners’ ballots for each of the Trust’s units were voted and returned. The ballots included a space to write in the owner’s address; except in two instances in which the address space was left blank, the voted ballots that Edwards returned all gave attorney Enriquez’s address as the owner’s address.

Bear Creek also sent notices of delinquent homeowners’ association assessments for the units, and notices of intent to file a lien. These notices were sent both by first class mail and by certified mail with return receipt requested, to the Trust at attorney Enriquez’s address. The certified mail envelopes were returned unclaimed, but the first class mail was not returned by the post office.

Before Bear Creek filed the instant suit, no one had ever informed Bear Creek that attorney Enriquez was not authorized to receive communications from Bear Creek at her address. Normally, if a property owner wishes to change its address of record with Bear Creek, the owner notifies the property manager in writing. The property manager never received such a notification with respect to units 9-16 of CCV Phase IV.

Bear Creek adduced evidence that it had charged association assessments to prior owners of units 9-16, even though those eight units were unbuilt. Bear Creek also charged assessments to other unbuilt units within the Bear Creek master development. The triggering event is when one unit in a phase is sold; after that, assessments are charged to each unit in the phase. Bear Creek consistently charged such assessments against every unit in a phase which had sold one property, and had done so regardless of whether the unit consisted of a house, townhouse, condominium, or unbuilt structure.

Edwards testified that he believed the assessments, under the CC & R’s, applied only to “condominiums.” Inasmuch as there were no condominium buildings on his property, he took the view that he had no duty to pay the assessments. He further testified that he also believed that he [342] had no right, as he owned no “units” or “condominiums,” to vote in homeowners’ association elections. He claimed that Bear Creek had erred in sending him any homeowners’ association ballots, but that he had voted the ballots only to “protect” himself. The day following this testimony, however, Edwards executed a proxy with respect to the Bear Creek election for three members of the board of directors, and cast 24 ballots (three for each unit of his property) in that election. Edwards did not deny sending the proxy, but testified that he had immediately sent a revocation of the proxy “[t]o the same man I sent the proxy to.”

In December 1998, Edwards executed a deed of trust on the property in favor of attorney Enriquez; this transaction was to secure payment of Enriquez’s attorney fees in representing Edwards in various matters concerning the property; Edwards had encountered numerous difficulties in getting the property ready to develop. Among other things, he learned after he had acquired the property that tax assessments were delinquent.

Edwards gave evidence that he and attorney Enriquez had had difficulty gaining access to the Bear Creek development, a gated community. Edwards spoke to an onsite employee to apply for vehicle stickers for his and Enriquez’s cars. In the vehicle permit application, Edwards requested that stickers for his and his wife’s cars be mailed to his business address. He testified that he duly received the vehicle permits, and never thought to do anything else about changing his record address with the property manager.

In any event, Bear Creek charged assessments and sent notices for these assessments to Edwards at attorney Enriquez’s address. Edwards disputed the legality of the assessments, inasmuch as there were no built-out structures corresponding to units 9-16 of CCV Phase IV. Bear Creek sent notices of delinquency, filed lis pendens until its lien could be established, and filed the instant action for, among other things, judicial foreclosure, foreclosure of an equitable lien, and breach of contract. Edwards answered on October 13, 2000. (Edwards also filed a cross-action which was later dismissed as to Bear Creek — as a sanction for discovery abuses — and apparently transferred to a different court to be consolidated with a different action involving different parties. The cross-complaint is not in issue on this appeal.)

After considerably protracted and contentious pretrial proceedings, trial began on May 27, 2003. The court exercised its discretion to try the equitable issues and questions of law first, to the court, reserving jury trial for the common law issues, if any remained.

The trial proceeded normally for the first two days. On the third day of trial, attorney Enriquez did not appear. Edwards, who had been traveling with her, reported that Enriquez had suffered chest pains while en route to court that day, and went to the emergency room for evaluation. On the following day, a Friday, Enriquez again did not appear. She sent a letter and a note to the court by fax, after normal business hours. The note stated that Enriquez was placed on a 60-day medical leave for further evaluation, but the note was not signed under oath and gave no details of Enriquez’s medical condition.

The following Monday, June 2, 2003, the court ordered attorney Enriquez to appear by June 5, 2003, or to submit a sworn declaration of a physician explaining why Enriquez had failed to appear in court. Enriquez instead filed a request for a continuance of the trial for 60 days for claimed medical disability. Enriquez [343] averred that she was completely debilitated and could not “function in day to day activities.” She also appended a doctor’s letter which stated only vaguely that Enriquez’s condition was being “worked-up,” and that “[d]epending on the outcome of the work-up, she may return to work prior to or after the estimated sixty-days period.” This letter was unsworn and provided no intelligible information on Enriquez’s medical condition.

On June 5, 2003, the date set to resume trial, neither attorney Enriquez nor Edwards appeared. The court therefore ordered a postponement of the trial until July 30, 2003 (approximately 60 days from the onset of attorney Enriquez’s alleged medical disability). The order advised both Enriquez and Edwards that, if Enriquez was medically unable to resume trial on July 30, 2003, Edwards should be prepared to go forward with new counsel; the 60-day continuance should afford Edwards sufficient time for new counsel to prepare to proceed.

On July 30, 2003, attorney Enriquez again failed to appear. A new attorney, Carter F. Johnston, appeared on Enriquez’s behalf. This time, attorney Enriquez averred that she may have suffered a small stroke four or five days earlier. This claim was supported only by unsworn doctors’ statements, despite the court’s earlier order that Enriquez must present verified evidence of her medical condition, substantiating her incapacity to appear at trial.

Attorney Johnston also claimed that he was unprepared to proceed with the trial on July 30, 2003, despite the court’s express direction to attorney Enriquez to inform her client (Edwards) of the need to proceed without fail on that date, and to obtain new counsel if necessary to do so. The court denied attorney Johnston’s request for a further continuance. The highly unusual circumstances of attorney Enriquez’s absenting herself from court in the midst of trial, without providing verified evidence of any medical disability or incapacity, resulted in an order for sanctions, which has been reviewed in a separate appeal. (Bear Creek Master Association v. Edwards(Sept. 21, 2004, E034591) [nonpub. opn.])

The case then proceeded on July 30 and 31, 2003. The court issued a statement of decision, finding in favor of Bear Creek on both the judicial and equitable foreclosure causes of action. Because no triable issues of fact remained with respect to any alleged breach of contract, the court also granted Bear Creek’s motion for a directed verdict on that cause of action. The court thereupon gave judgment for Bear Creek in the amounts requested. The court further found that Bear Creek was the prevailing party and thus entitled to attorney fees.

Edwards moved for a new trial. This was apparently denied, and Edwards filed a notice of appeal from the judgment.

Bear Creek submitted a motion for attorney fees; Bear Creek then moved to amend the judgment to include both the attorney fees and costs award and an amount previously ordered as sanctions. The court signed the judgment as amended.

Bear Creek then objected to the amount of the undertaking Edwards had posted before taking an appeal; inasmuch as the judgment had been substantially increased by the addition of the attorney fees and costs award, Bear Creek asked the court to order Edwards to provide an increased undertaking on appeal. The court found that the undertaking already deposited was insufficient, in light of the amounts added to the judgment for attorney fees and costs, and ordered Edwards to deposit [344] additional funds for the undertaking on appeal. Edwards filed a second notice of appeal, encompassing the award of attorney fees and costs as well as the requirement of an additional undertaking on appeal.

This court eventually consolidated these two appeals.

ANALYSIS

Edwards raises a plethora of issues, some of which are duplicative, and none of which has merit, with only one possible minor exception.

I. Edwards Was Required to Pay Assessments, Notwithstanding the Absence of an Actual Structure on the Property

Edwards’s primary contention throughout the action was that assessments pertain only to a “condominium,” and that a “condominium” must contemplate an actual, existing structure. In the absence of a building or structure, no duty to pay assessments arose under either statutory law or under the Bear Creek CC & R’s. Edwards thus argues, first of all, that the court erred in denying his motion for a directed verdict on all causes of action. He asserts that Bear Creek could not prove an essential element of all the causes of action: to wit, the existence of a “condominium.”

A. The Davis-Stirling Act Defines a “Condominium” as “Space” Described in a Qualifying Instrument

Edwards insists that “[v]acant land is not a condominium.” This claim is based upon a proposed construction of the relevant statutory authority and, to some extent, of the Bear Creek CC & R’s. The construction of both statutes and contractual documents presents questions of law, which we review de novo. (Regents of the University of California v. Superior Court (1999) 20 Cal.4th 509, 531, 85 Cal.Rptr.2d 257, 976 P.2d 808; Morgan v. City of Los Angeles Bd. of Pension Comrs. (2000) 85 Cal.App.4th 836, 843, 102 Cal.Rptr.2d 468.)

Civil Code section 783 was enacted in 1963. (Stats.1963, ch. 860, § 1, p. 2090.) It defined a condominium as “an estate in real property consisting of an undivided interest in common in a portion of a parcel of real property together with a separate interest in space in a residential, industrial or commercial building on such real property, such as an apartment, office or store.” (Italics added.) An amendment in 1969 did not alter this language in the statute. (Stats.1969, ch. 275, § 1, p. 624 [amending the description of a possible condominium interest from an “estate for years” to an “estate for years, such as a leasehold or subleasehold”].)

In 1984, however, the definition of a “condominium” was changed considerably. Civil Code section 783 was amended to read: “A condominium is an estate in real property consisting of an undivided interest in common in a portion of a parcel of real property together with a separate interest in space, the boundaries of which are described on a recorded final map, parcel map, condominium plan or other document in sufficient detail to locate all boundaries thereof. The area within such boundaries may be filled with air, earth, or water or any combination thereof and need not be physically attached to the land except by easements for access and, if necessary, support. The description of such space may refer to (i) boundaries described in the recorded final map, parcel map, condominium plan or other document; (ii) physical boundaries, either in existence, or to be constructed, such as walls, floors and ceilings of a structure or portion thereof; (iii) an entire structure containing one or more separate interests [345] in space; or (iv) any combination thereof. The portion of the parcel of real property held in undivided interest may be all of the real property of an existing parcel or lot (except for the separate interests in space) or may include a particular three-dimensional portion thereof, the boundaries of which are described on a recorded final map, parcel map, condominium plan or other document. The area within the boundaries may be filled with air, earth, or water, or any combination thereof, and need not be physically attached to land except by easements for access and, if necessary, support. A condominium may include in addition a separate interest in other portions of such real property….” (Italics added.) Civil Code section 1350 was amended to reflect that, “As used in this title unless the context otherwise requires: [¶] 1. `Condominium’ means a condominium as defined in Section 783 of the Civil Code. [¶] 2. `Unit’ means the elements of a condominium which are not owned in common with the owners of other condominiums in the project. [¶] 3. `Project’ means the entire parcel of real property divided, or to be divided into condominiums, including all structures thereon. [¶] 4. `Common areas’ means the entire project excepting all units therein granted or reserved….” (Stats.1984, ch. 291, § 2, p. 1518.)

Thus, we see that “condominium” was radically redefined to mean a separate interest in space, within boundaries described by certain qualifying documents. The “space” may consist of air, earth or water, or any combination of these things, so long as the boundaries of that space are adequately described in the proper recorded document. There was no longer any requirement for an existing building or structure as a defining characteristic of a condominium.

In 1985 (effective in 1986), the Legislature enacted the Davis-Stirling Common Interest Development Act (the Davis-Stirling Act). (Stats.1985, ch. 874, § 14, p. 2774.) To accomplish this, the Legislature repealed Civil Code section 783, and enacted a new Civil Code section 783 (Stats.1985, ch. 874, §§ 8, 9, p. 2772), reading as follows: “A condominium is an estate in real property described in subdivision (f) of Section 1351.” In other words, the definition of “condominium” was transferred from Civil Code section 783, to Civil Code section 1351, subdivision (f).

The Legislature also repealed Title 6 of Part 4 of Division 2 of the Civil Code (beginning with § 1350), and enacted replacement provisions (the Davis-Stirling Common Interest Development Act). New Civil Code section 1351, subdivision (f), defines a condominium as: “an undivided interest in common in a portion of real property coupled with a separate interest in space called a unit, the boundaries of which are described on a recorded final map, parcel map, or condominium plan in sufficient detail to locate all boundaries thereof. The area within these boundaries may be filled with air, earth, or water, or any combination thereof, and need not be physically attached to land except by easements for access and, if necessary, support. The description of the unit may refer to (1) boundaries described in the recorded final map, parcel map, or condominium plan, (2) physical boundaries, either in existence, or to be constructed, such as walls, floors, and ceilings of a structure or any portion thereof, (3) an entire structure containing one or more units, or (4) any combination thereof. The portion or portions of the real property held in undivided interest may be all of the real property, except for the separate interests, or may include a particular three-dimensional portion thereof, the boundaries of which are described on a recorded [346] final map, parcel map, or condominium plan. The area within these boundaries may be filled with air, earth, or water, or any combination thereof, and need not be physically attached to land except by easements for access and, if necessary, support….”

This definition of a “condominium,” derived from former Civil Code section 783, as amended in 1984, carried forward the changed description of a condominium, so that it no longer required the existence of a structure or building.

B. Civil Code Section 1646 Is Inapplicable

Edwards relies on the original definition of condominium, as set forth in the pre-1984 versions of Civil Code section 783. He strenuously argues that that definition requires a “condominium” to consist of a structure or building. Edwards further argues that, pursuant to Civil Code section 1646, contracts — here, the Bear Creek CC & R’s — must be construed according to the law and usage “of the place” where the contract was made.^[FN.1] This “place,” Edwards maintains, is pre-1984 California; thus, the term “condominium,” according to the “law and usage” of California before 1984 must be construed to require an actual structure. The Bear Creek CC & R’s were created before 1984, and should therefore be subject to the pre-1984 definition in Civil Code section 783.

Edwards’s reliance on Civil Code section 1646 is misplaced. He is attempting to import a “law of time” rather than a “law of place” into the CC & R’s as a contract or instrument. Whether pre- or post-amendment law is applied, the CC & R’s properly apply the law of place where the contract was created or intended to be performed: i.e., California. Civil Code section 1646 is irrelevant to the question whether the new definition of “condominium” under California law applies to the Bear Creek CC & R’s.

C. The New Definition of a “Condominium,” Not Requiring a Structure, Applies to Edwards’s Property

The Davis-Stirling Act by its own terms applies to all common interest developments, even those that were created before the Act was adopted. (Civ.Code, § 1352; Villa de las Palmas Homeowners Assn. v. Terifaj (2004) 33 Cal.4th 73, 81, fn. 2, 14 Cal.Rptr.3d 67, 90 P.3d 1223.; Nahrstedt v. Lakeside Village Condominium Association (1994) 8 Cal.4th 361, 378, fn. 8, 33 Cal.Rptr.2d 63, 878 P.2d 1275.) Civil Code section 1352 states in relevant part: “This title applies and a common interest development is created whenever a separate interest coupled with an interest in the common area or membership in the association is, or has been, conveyed….” (Italics added.)

Edwards attempts to avoid the application of the Davis-Stirling Act to his property by arguing that he acquired no fee simple estates in the deed by which he took title to units 9-16 of CCV Phase IV. He contends that the Trust owns an “undivided parcel of land [which] has not yet been divided into separate interests.” Thus, Edwards contends, the trust does not own any “condominiums,” defined as consisting both of an “undivided interest in common in a portion of real property,” [347] together with “a separate interest in space….” (Civ.Code, § 783.)

Edwards’s argument is disingenuous. The deed by which the Trust received title recites that the property received does qualify as a “condominium” — eight of them, in fact — consisting of both an “undivided interest” in common areas and a fee simple interest in a condominium unit.

Edwards’s deed conveyed an “undivided 8/16th fractional interest” in the common areas of “lots 1 and 2 of Tract Map 20829, in the County of Riverside, State of California, as per map recorded in Book 161, pages 3 through 4, inclusive, of Maps, in the Office of the County Recorder of said County.” The undivided (common) interest in lots 1 and 2 of Tract Map 20829 specifically excluded, “all living units and garages shown upon Country Club Villas-Phase 4 Condominium Plan recorded in the Office of the County Recorder of Riverside County, California on September 9, 1986 as Instrument No. 219590.” (Italics added.) In other words, the “undivided interest” conveyed in lots 1 and 2 of Tract Map 20829 included common areas and excluded the condominium units themselves, which were to be owned exclusively by their owners/occupiers: i.e., the fee simple portion of the condominium unit.

Edwards purchased eight such condominium units: units 9 through 16, with the exclusive right to use, possess and occupy those units. That Edwards owns more than one unit does not detract from Edwards’s exclusive right, in fee simple, to occupy the living unit and garage areas for units 9 through 16, as described on the CCV Phase IV condominium plan. Indeed, there would be utterly no point in describing Edwards’s title to “Living unit and garage Nos. 9 through 16 as shown upon the condominium plan,” if the deed did not convey a fee simple interest in those condominium units.

Edwards’s argument that the land itself is “undivided,” is an example of the logical fallacy of “equivocation,” in which he has shifted the meaning of the word. The “undivided interest” conveyed in the deed is ownership, held in common with all the other owners in lots 1 and 2 of Tract Map 20829, to the common areas in lots 1 and 2. The condominium areas—the living units and garages as described in the condominium plan — are specifically excluded from the description of Edwards’s “undivided interest.” That Edwards has not sold any individual units — whether constructed or not — is wholly irrelevant to the existence of both an undivided (common) interest and a fee simple (exclusive) interest, which comprise a condominium. The eight units Edwards acquired meet the statutory definition of a “condominium” under the Davis-Stirling Act, inasmuch as they are specifically described in a qualifying condominium plan, the CCV Phase IV plan as described in Edwards’s deed. Edwards has failed to demonstrate that the Davis-Stirling Act does not apply to his condominium units.

D. Edwards Was Not Entitled to a Directed Verdict

Inasmuch as we have concluded that the Davis-Stirling Act, and its definition of a “condominium,” applied to Edwards’s property, we necessarily also conclude, as did the trial court, that Edwards owns eight “condominiums.” In light of this conclusion, we categorically reject Edwards’s initial contention, that the trial court erred in denying a motion for directed verdict, premised on the notion that Bear Creek could not prove the existence of any “condominiums” for which assessments were payable. Bear Creek did prove the existence of eight condominiums; Edwards was not entitled to a directed verdict.

[348] E. Edwards Had a Duty to Pay Assessments

Under both the Davis-Stirling Act and the Bear Creek CC & R’s, assessments become due upon all units in a phase after the first unit in a phase has sold. The evidence at trial was uncontradicted that the first unit in CCV Phase IV sold no later than 1986, long before Edwards acquired his units. This event triggered the duty of each owner of a unit in that phase to pay assessments. The CC & R’s declared, “The Annual Assessments … shall commence as to all lots (including those owned by Declarant) on the first day of the month following the conveyance of the first lot by Declarant to an individual Owner; provided however, that annual assessments shall commence for all Lots located within a phase of the Properties which has been annexed hereto on the first day of the month following the conveyance of the first lot in such phase by Declarant to an individual Owner….” CCV Phase IV had been annexed into the Bear Creek master development in August of 1986.

The evidence was therefore without dispute that the triggering events — annexation and first sale of a lot to an individual owner — had taken place with respect to CCV Phase IV. Thereafter, Bear Creek at all times charged annual assessments against each unit in CCV Phase IV, whether or not the unit had been built out.

Edwards owned eight units in CCV Phase IV. Edwards therefore owed a duty under both the Davis-Stirling Act and the Bear Creek CC & R’s to pay those assessments, regardless of the absence of an actual condominium structure or building. The definition of a “condominium” as a unit of “space,” which “space” may consist of air, water or earth, in no wise requires an actual structure or building; rather, it requires a specific description in a particular kind of qualifying recorded instrument. Such an instrument (condominium plan) exists here. As a matter of law, based upon statutory construction, interpretation of the written CC & R’s, and undisputed facts, the Trust owed a duty to pay assessments to Bear Creek for each of the eight condominium units it owned.

F. Edwards Failed to Pay Any Assessments

The evidence was undisputed that the Trust at all times failed and refused to pay any assessments for any of its condominium units. The evidence was further undisputed as to the amounts of the regular assessments charged and which remained unpaid. As a matter of law, therefore, Bear Creek had demonstrated that Edwards owed a duty to pay assessments and had failed to do so. Bear Creek was therefore entitled to pursue its enforcement remedies under the CC & R’s.

II. Bear Creek Properly Gave Notice of Its Liens

Edwards next complains that Bear Creek failed to comply with the statutory notice requirements for filing its liens against Edwards’s lots.

A. Notice Was Given to the Owner at the Owner’s Designated Address

More specifically, Edwards argues that Bear Creek “never complied with notice requirements to Edwards, the only person entitled to notice.” He contends that the notices sent to him at attorney Enriquez’s address were of no effect, because he never designated her as his agent; he further asserts that Bear Creek should not have been permitted to present evidence on the issue of agency, because that issue was not specifically alleged in Bear Creek’s complaint.

[349] 1. Notice Was Mailed to Edwards (the Owner) at the Address Selected by Both Edwards and His Attorney

The claim that Edwards did not receive proper notice is disingenuous. Attorney Enriquez’s address was the address listed on Edwards’s title deed to the property. Bear Creek consistently sent information, mailings, requests and notices to Edwards at attorney Enriquez’s address. Attorney Enriquez consistently responded, on Edwards’s behalf, to these mailings, requests and notices.

For example, Bear Creek first sent notice of the overdue assessments to Edwards(i.e., to “Edward Trust” [sic] — the record owner — by name), in care of attorney Enriquez, on February 27, 1998. Attorney Enriquez, using her own letterhead, replied on behalf of Edwards, advising Bear Creek that Edwards “dispute[d] [the] `Notice of Past Due Assessments,'” on the bases both that Edwards had never received an initial statement concerning assessments on the property, and that there were no structures on the property. Notably, attorney Enriquez’s correspondence did not advise Bear Creek to use any other address to contact Edwards. Attorney Enriquez also responded on Edwards’s behalf in several other instances, and the Edwardses themselves never made any written request to have Bear Creek’s correspondence sent to them at any other address.

The only exception was Edwards’s request to an unknown person at the gate kiosk for parking decals; the decals were duly sent to his business address. Otherwise, however, Edwards took no steps to prevent Bear Creek from sending its correspondence to him at attorney Enriquez’s address. Indeed, Bear Creek sent ballots to Edwards at attorney Enriquez’s address, which ballots Edwards then personally cast. As to one set of eight ballots, Edwards himself filled in attorney Enriquez’s address as the owner’s address in the space provided on each ballot. On another set of eight ballots, he again wrote in attorney Enriquez’s address as the owner’s address on six of the eight ballots (two ballots left the owner’s address space blank). Edwards himself therefore consistently designated attorney Enriquez’s address as the proper mailing address for the Trust, the property owner.

Edwards testified at trial that he had voted the ballots — giving attorney Enriquez’s address as the “owner’s” mailing address — in error, or that he had done so only to “protect” his rights. A mere two days after giving this testimony, however, he executed a proxy for each of his eight units, to cast three ballots per unit, or 24 total votes, in the election of Bear Creek’s Board of Directors. He faxed this proxy to the designated election inspector, who in turn cast the ballots as directed by Edwards’s proxy instructions. The execution of the proxy was wholly inconsistent both with Edwards’s claim that he owned no assessable “units,” and with the assertion that Bear Creek was not entitled to correspond with him at attorney Enriquez’s address. Under Bear Creek’s CC & R’s, only assessable units are entitled to vote in association elections. The notice of the election presumably was not sent to Edwards at any address other than the one Edwards had designated on all the earlier ballots as the Trust’s correspondence address: attorney Enriquez’s address. The proxy was faxed from the same fax number that attorney Enriquez used for her fax communications to and from the court. Edwards attempted to disclaim the proxy, testifying that he had also sent a fax revoking the proxy; he did not say when he sent the revoking fax, however, and the election inspector testified that no such revocation was received before the close of [350] the election. Notably also, Edwards produced no document to substantiate his claim that he had revoked his proxy. (In addition, Edwards’s testimony failed to explain why he had faxed his election proxy in the first place, had he truly believed he had no assessable lots, and thus was not entitled to vote in any Bear Creek elections.)

Civil Code section 1367, subdivision (a), provides in relevant part that, “[b]efore an association may place a lien upon the separate interest of an owner to collect a debt which is past due under this subdivision, the association shall notify the owner in writing by certified mail of the fee and penalty procedures of the association, provide an itemized statement of the charges owed by the owner, including items on the statement which indicate the assessments owed, any late charges and the method of calculation, any attorney’s fees, and the collection practices used by the association, including the right of the association to the reasonable costs of collection….” (Italics added.)

Manifestly, Bear Creek complied with this requirement. The notice was sent by certified mail to the owner at the address consistently used by the owner and the owner’s attorney. Attorney Enriquez refused to sign the certified mail receipts, and the lien notices were returned to Bear Creek. Bear Creek had also sent the lien notices by first class mail, however, and none of the first class mail envelopes were returned.

2. Notice Cannot Be Defeated by Willful Failure to Accept Certified Mail

Edwards claims that Bear Creek failed to comply strictly with Civil Code section 1367, arguing that “there is no presumption of notice absent a signed certified receipt,” citing Code of Civil Procedure section 1020. This argument is again disingenuous. Code of Civil Procedure section 1020 provides that, “Any notice required by law, other than those required to be given to a party to an action or to his attorney, the service of which is not governed by the other sections of this chapter and which is not otherwise specifically provided for by law, may be given by sending the same by registered mail with proper postage prepaid addressed to the addressee’s last known address with request for return receipt, and the production of a returned receipt purporting to be signed by the addressee shall create a disputable presumption that such notice was received by the person to whom the notice was required to be sent.”

Code of Civil Procedure section 1020 is permissive; where a notice is required to be sent by mail, compliance with the mailing requirement may be satisfied by sending the notice by registered mail with a return receipt requested. Code of Civil Procedure section 1020 does not require mailed notices to be sent by registered mail. Likewise, while a signed return receipt may create a rebuttable presumption that the notice was received, the absence of such a signed return receipt does not negate any other presumptions concerning mailed items. Under Evidence Code section 641, “[a] letter correctly addressed and properly mailed is presumed to have been received in the ordinary course of mail.”

Of course, a presumption of receipt is rebutted upon testimony denying receipt. (Slater v. Kehoe (1974) 38 Cal.App.3d 819, 832, fn. 12, 113 Cal.Rptr. 790; accord Craig v. Brown & Root, Inc. (2000) 84 Cal.App.4th 416, 421-422, 100 Cal.Rptr.2d 818.) The presumption of Evidence Code section 641 properly applied here, unless rebutted by a denial of receipt. Attorney Enriquez did not testify, and thus never denied under oath that she [351] had received the lien notices mailed to Edwards at her address. Edwards was in no position to deny receipt of the mail at attorney Enriquez’s address.

Even if we accept for the sake of the argument, however, that the tenor of Edwards’s evidence was the intent to deny receipt of the lien notices, “the disappearance of the presumption does not mean there is insufficient evidence to support the trial court’s finding [i.e., of receipt of notice].” (Craig v. Brown & Root, Inc., supra, 84 Cal.App.4th at p. 421, 100 Cal.Rptr.2d 818, italics in original) “`”[I]f the adverse party denies receipt, the presumption is gone from the case. [But] [t]he trier of fact must then weigh the denial of receipt against the inference of receipt arising from proof of mailing and decide whether or not the letter was received.“‘” (Id. at p. 422, 100 Cal.Rptr.2d 818, italics in original.)

Here, the evidence was uncontradicted that Bear Creek mailed the lien notices both by certified mail, as required, and by first class mail. Attorney Enriquez refused to sign for the certified letters, and those letters were returned by the post office. The first class letters were not returned, however. The correspondence from attorney Enriquez, on Edwards’s behalf, plainly demonstrated knowledge of the disputed assessments. The inference is inescapable: attorney Enriquez in fact received all the notices, but simply refused to accept the certified mail.

The requirement to send the lien notices by certified mail cannot be defeated by the simple expedient of refusing to sign the return receipt. “Where a statute provides for service by registered or certified mail, the addressee cannot assert failure of service when he wilfully disregards a notice of certified mail delivered to his address under circumstances where it can reasonably be inferred that the addressee was aware of the nature of the correspondence.” (Hankla v. Governing Bd. (1975) 46 Cal.App.3d 644, 655, 120 Cal.Rptr. 827.)

3. The Notice Was Properly Served, Whether Regarded as Served on the Owner or on the Owner’s Agent

That “agency” was not specifically pled is a red herring. First, Edwards consistently designated a certain address as the Trust’s (owner’s) address for correspondence with Bear Creek. That the designated address happened also to be attorney Enriquez’s address does not defeat the evidence that notice was given to the owner at the owner’s designated mailing address.

Second, the evidence also supported the view that Enriquez was Edwards’s agent with respect to any correspondence with Bear Creek. Either Enriquez was Edwards’s actual agent, or she was his ostensible agent. “Ostensible authority is such as a principal, intentionally or by want of ordinary care, causes or allows a third person to believe the agent to possess.” (Civ.Code, § 2317.) Here, all of Edwards’s and Enriquez’s actions intentionally or negligently fostered the belief that Enriquez’s address was the owner’s address for purposes of all correspondence from Bear Creek and that Enriquez was empowered to act on Edwards’s behalf with respect to the CCV Phase IV property and the disputed assessments. As the trial court remarked, “it appears to the court . . . that when it’s convenient to use Miss Enriquez and her address, that’s what they do. And when it is not convenient, then there is a disclaimer that Miss Enriquez has no [sic; any?] authority to act on his behalf. Mr. Edwards . . . will be estopped from making that claim.”

The issue of agency, if any, was not an issue “outside” the pleadings. (Cf. 4 Witkin, [352] Cal. Procedure (4th ed., 1997) Pleading, § 488, p. 579, § 873, p. 330 [“In actions by a principal on a contract made by the agent, that pleading [i.e., the fact of agency] is unnecessary; it is sufficient to allege [the ultimate fact] that plaintiff and defendant entered into the contract”].) The issue to be tried was “notice.” The issue of notice necessarily encompasses evidence of the means by which notice was accomplished. Inasmuch as notice may be accomplished either directly or through an agent, the evidence adduced was within the issues raised by the pleadings.

Edwards was properly served with the lien notices in compliance with Civil Code section 1367.

B. The Court Properly Determined the Amount of the Lien Assessments

In connection with the attack on the propriety of the lien notice, Edwards asserts that the amount of the lien must be limited to the amount initially stated in the notice; in other words, Edwards argues that no “recurring liens” are authorized under Civil Code section 1367, and that Bear Creek’s recovery must therefore be limited to the amount stated in the initial lien notice, or $484.54 per lot. (We note, as an aside, that each of the notices actually specified $587.08 as the amount of delinquent assessments; together with costs, $879.58 was the amount sought per lot for unpaid assessments, to the date of notice.)

We are not persuaded. Civil Code section 1367, subdivision (b), provides in relevant part, “The amount of the assessment, plus any costs of collection, late charges, and interest assessed in accordance with Section 1366, shall be a lien on the owner’s interest in the common interest development from and after the time the association causes to be recorded with the county recorder of the county in which the separate interest is located, a notice of delinquent assessment. . . .” [Italics added.]

Civil Code section 1366, in turn, refers to provisions for assessments in an association’s “governing documents,” such as the Bear Creek CC & R’s. Article V, Section 11(b), of the Bear Creek CC & R’s provides that a lien includes: “[t]he total amount claimed to be due and owing for the amount of delinquency, interest thereon, collection costs, and estimated attorneys’ fees.” It further provides that “any demand or claim of lien or lien on account of prior delinquencies shall be deemed to include subsequent delinquencies and amounts due on account thereof.” (Italics added.) The recorded lien notices, also mailed to Edwards, included the statement that, “[a]dditional monies shall accrue under this claim at the rate of the claimants’ regular monthly or special assessments, plus permissible late charges, costs of collection and interest, accruing subsequent to the date of this notice.”

As Bear Creek observes, all of the sums included on the liens and lien notices are authorized by the CC & R’s and statutory law. The amounts here determined by the court to be owing as liens are no more than the amounts authorized by the governing documents and statutes.

Pursuant to Civil Code section 1366, subdivision (a), “[c]ondominium homeowners associations must assess fees on the individual owners in order to maintain the complexes.” (Park Place Estates Homeowners Assn. v. Naber (1994) 29 Cal.App.4th 427, 431-432, 35 Cal.Rptr.2d 51, italics original.) Those fees are statutorily prescribed to be “a debt of the owner . . . at the time the assessment . . . [is] levied.” (Civ.Code, § 1367, subd. (a).) “These statutory provisions reflect the Legislature’s recognition of the importance of assessments to the proper functioning of condominiums in this state. Because homeowners associations would cease to exist without regular payment of assessment [353] fees, the Legislature has created procedures for associations to quickly and efficiently seek relief against a nonpaying owner.” (Park Place Estates Homeowners Assn. v. Naber, supra, 29 Cal.App.4th at p. 432, 35 Cal.Rptr.2d 51, italics added.)

Were the relevant provisions to be construed as Edwards suggests, the described statutory purpose of providing for a quick and efficient means of enforcing the CC & R’s would be seriously undermined; each month, or at such other intervals as the assessments are charged under a given set of CC & R’s, the association would be required to record successive liens. A successive recordation requirement would impose a heavy — and needless — burden upon homeowners’ associations, fraught with risk to the association, and undue windfall to the delinquent homeowner, should any installment be overlooked. We are unwilling to construe Civil Code section 1367 to require such an oppressive burden. Both delinquent homeowners and the public at large are placed on notice, with the recordation of the initial assessment lien, that subsequent regularly and specially levied assessments, if they continue unpaid, will accrue in due course. The purpose of the lien notice and recordation will have been served, and the association’s remedy justly preserved, by the initial recordation of lien.

Inasmuch, also, as Edwards has admitted that the assessments, charges, and other moneys due and owing under the CC & R’s have never been paid, we find no error in the court’s determination of the amounts due.

III.-VI.^[FN.**]

DISPOSITION

The trial court is ordered to strike from its statement of decision the findings that Bear Creek was not guilty of unclean hands or fraud. The amendment to the statement of decision in no wise affects the validity of the judgment, however. The judgment is in all respects affirmed. The appeal from the postjudgment order setting the amount of the security deposit on appeal is moot. Costs on appeal are awarded to Bear Creek as the prevailing party on appeal.

McKINSTER Acting P.J., and KING, J., concur.

___________________________________________________________________________

[FN.*] Pursuant to California Rules of Court, rule 976.1, this opinion is certified for publication with the exception of parts III, IV, V and VI.

[FN.1] Civil Code section 1646 states: “LAW OF PLACE. A contract is to be interpreted according to the law and usage of the place where it is to be performed; or, if it does not indicate a place of performance, according to the law and usage of the place where it is made.”

[FN.**] See footnote *, ante.

Alpert v. Villa Romano Homeowners Association

(2000) 96 Cal.Rptr.2d364

[Maintenance; Duty of Care] HOA’s responsibility with respect to maintenance and repair of sidewalks adjacent to HOA’s property.

Law Offices of Steven M. Klugman and Steven M. Klugman, Los Angeles, for Plaintiff and Appellant.
Early, Maslach, Price & Baukol and James Grafton Randall, Los Angeles, for Defendant and Respondent,

GOODMAN, J.^[FN.*]

Ann Alpert (Alpert) appeals from the judgment of nonsuit entered in favor of respondent Villa Romano Homeowners Association (VRHA) at the close of Alpert’s case-in-chief. Alpert’s complaint alleged that she suffered severe injuries when she tripped and fell on the upturned and broken sidewalk adjacent to the condominium complex managed by VRHA.^[FN.1] In this appeal [368] Alpert asks that we determine if the owner and possessor of property owes a duty to warn or protect pedestrians from allegedly dangerous conditions known to be present. We conclude that there is such a duty and that the trial court erred in granting the defense motion for nonsuit made at the close of Alpert’s case-in-chief.

FACTUAL AND PROCEDURAL HISTORY

In the late morning of July 27, 1992, Alpert, then 69 and in good health, took her four-year-old dog, BJ, a poodle weighing approximately eight pounds, for a walk near her home in Marina del Rey. She had BJ on a leash. Alpert walked her dog several times a day, but had never fallen before while walking him. This day, on the way home, she passed in front of the VRHA condominium property (the property), which is near the condominium complex in which she resided. The weather was dry and clear; the summer sun was overhead. Alpert’s walk ended when one of her feet came in contact with an upturned, jagged piece of sidewalk, causing her to lose her balance and fall, face first, to the sidewalk. After her fall, she noticed that there was grass growing in this break in the sidewalk.

The fall knocked the wind out of her. In the fall, Alpert fractured her right wrist, fractured and lacerated her left knee, broke her fourth and fifth ribs, and sustained a large hematoma in the area of her right breast. She sought medical attention for her injuries, eventually having surgery to repair her left knee. During her recovery from the fall, she contracted pneumonia. At the time of trial, she was unable to walk more than a block without pain, and was using a wheelchair to go longer distances.

Luz Enriquez (Enriquez) had been the gardener for VRHA for 20 years. He worked at the property three times each week. In addition to performing gardening services in the area of the property between the condominium buildings and the sidewalk, including the lawn, which he routinely mowed, he did similar work in the area between the sidewalk and the curb. He routinely removed leaves and other debris from the sidewalk, including removing such material that accumulated from time to time in the crack at the location of the upturned sidewalk. He also watered the vegetation on both sides of the sidewalk, utilizing the sprinklers which VRHA had installed in both areas. Enriquez was aware of the break in the sidewalk and recalled that it had been there for a few years prior to the date of Alpert’s fall.

Bernardo Segala had been hired by VRHA to trim trees on its property. During the year 1992 and prior to Alpert’s fall, at the request of VRHA he trimmed trees on the lawn between the sidewalk and the condominium property and on the portion of the lawn between the sidewalk and the street.

John Pettijohn, who had expertise in concrete repairs, measured the difference in elevation caused by the break in the sidewalk at the scene of the fall at between three-fourths of an inch and one inch.

Elihu Crane, a resident of VRHA, was a member of its board of directors from 1990 through April 1992, and president of its board of directors for part of that time. During that two-year period there was no [369] person or committee of the board which had responsibility for inspecting the sidewalk in front of the property. VRHA’s view was that the City of Los Angeles (the city) controlled the sidewalks and all VRHA needed to do was to keep the sidewalk clean.

Judith Crane was in charge of the gardening committee of the VRHA. She inspected the property shortly after becoming chairman of that committee in the summer of 1992. She had been aware for some time of the existence of cracks in the sidewalk in the area in which Alpert fell and of other cracks in the sidewalk which ran along the property.

Dr. Stephen Wexler, a licensed civil engineer and licensed general contractor, testified as an expert witness at Alpert’s request. Dr. Wexler had experience in building concrete structures, including sidewalks, and in landscaping for the projects he built. Dr. Wexler also had expertise in determining the cause of sidewalk damage from root structures and root growth and expertise regarding human factors in relation to premises liability. Dr. Wexler inspected the scene of the fall on several occasions. He observed that there was mature vegetation on the property, including pine trees (some of which were 100 feet tall) between the sidewalk and buildings on the property, and bottlebrush trees in the area between the sidewalk and the street curb. In his opinion, the root of a pine tree had caused the sidewalk to be uplifted and to break. This opinion was confirmed by his observation of 15 to 20 sidewalk cracks in the area, of which seven or eight had caused serious distortions in the sidewalk in the form of uplifted panels of concrete or of cracks in panels which had been uplifted. There was a second such root-caused cracking and tilting within 15 feet of the scene of Alpert’s fall. He had observed that roots of pine trees can grow in length to be as much as four times the height of the tree itself. He explained that tree roots seek out the area under the sidewalk because water tends to collect there. He noted that the sprinklers at the property water the sidewalk as well as the lawn and other vegetation.

In Dr. Wexler’s opinion, the sidewalk defect at the location of Alpert’s fall had existed for years prior to the fall and had been caused by the progressive growth of a subterranean tree root under the sidewalk. He noted that the area of greatest angular uplift in the sidewalk was adjacent to the lawn, indicating in his opinion that the root that caused the uplift had come from a tree growing on the lawn as the root sought moisture. He explained that roots taper down in size the farther from the tree they grow. It was also his opinion that the growth of the trees and their root systems had been enhanced by the fertilizing, watering, and trimming of the trees, which VRHA had done on its property. Further, the roots remained near the surface due to the very hard-packed soil in the area, thus increasing the likelihood of cracking the sidewalk.

On cross-examination, Dr. Wexler testified that it was unlikely that the root that had caused the sidewalk at the point of Alpert’s fall to be upturned and to break had come from a tree in the area between the sidewalk and the street as roots of the bottlebrush trees planted in that area were smaller than those of the pine trees. Rather, it was his opinion that the root which had caused the sidewalk defect had come from a tree growing on the main lawn.

At the conclusion of Alpert’s case-in-chief, VRHA made a written motion for nonsuit. During argument on that motion, [370] Alpert’s motion for leave to reopen was denied. The court granted the motion for nonsuit, after which Alpert filed a timely appeal.^[FN.2]

CONTENTIONS ON APPEAL

Alpert contends the trial court erred (1) in concluding that VRHA, as owner of the property, owed Alpert no duty of care, (2) in refusing to permit Alpert to reopen to cure any defect that resulted in the nonsuit, (3) in refusing to permit Alpert to make offers of proof of certain evidentiary matters, and (4) by excluding evidence of knowledge of the condition of the sidewalk prior to the fall on the part of the board of directors of VRHA.^[FN.3]

DISCUSSION

Standard of review.

In reviewing a judgment entered upon a grant of a motion for nonsuit after the close of the plaintiffs case-in-chief (Code Civ. Proc, § 581c),^[FN.4] the appellate court reviews the entire record of the trial court (Kidron v. Movie Acquisition Corp. (1995) 40 Cal.App.4th 1571, 1581, 47 Cal. Rptr.2d 752) and views the evidence in the light most favorable to appellant. (Freeman v. Lind (1986) 181 Cal.App.3d 791, 799, 226 Cal.Rptr. 515.) We do not weigh the evidence or consider the credibility of the witnesses who have testified; rather we are required to accept as true the evidence most favorable to the plaintiff, disregarding conflicting evidence. (La-Monte v. Sanwa Bank California (1996) 45 Cal.App.4th 509, 517.) “`”The judgment of the trial court cannot be sustained unless interpreting the evidence most favorably to plaintiffs case and most strongly against the defendant and resolving all presumptions, inferences and doubts in favor of the plaintiff a judgment for the defendant is required as a matter of law.”‘”^[FN.5] (Freeman v. Lind, supra, 181 Cal.App.3d at p. 799, 226 Cal.Rptr. 515.)

This healthy skepticism of removing factual questions from juries is inextricably bound to the California Constitution, which preserves “inviolate” the right to trial by jury.^[FN.6^]

[371] 2. The trial court’s ruling.

At the conclusion of Alpert’s case-in-chief, VRHA presented a written motion for nonsuit to the court and counsel.^[FN.7] Such a motion has the effect of a demurrer to the evidence: It concedes the truth of the facts proved and contends that those facts are not sufficient as a matter of law to sustain the plaintiffs case. (See Lussier v. San Lorenzo Valley Water Dist. (1988) 206 Cal.App.3d 92, 98, 253 Cal.Rptr. 470.) A judgment of nonsuit is an involuntary dismissal (Costa v. Regents of University of Cal. (1951) 103 Cal.App.2d 491, 494, 103 Cal.App.2d 491) on a motion by a defendant who contends the plaintiff is unable to prove its case at trial (Doria v. International Union (1961) 196 Cal. App.2d 22, 32, 16 Cal.Rptr. 429). In reviewing a judgment of nonsuit, we look at the entire record. (Kidron v. Movie Acquisition Corp., supra, 40 Cal.App.4th at p. 1581, 47 Cal.Rptr.2d 752.) We consider grounds which were both advanced by the moving party and ruled on by the trial court.^[FN.8]

[372] The record in this case clearly shows that the trial court weighed the evidence and erred as to the applicable law. Thus, the trial court stated: “Dr. Wexler testified that he was not sure where the roots came from which caused the elevation…. [A]nd the law seems to indicate that the ambit of liability does not include the abutting land owners but includes the city for — the city owing the duty to the third person….”

This selection from the record by the trial court was inapposite. The record reveals substantial testimony by Alpert’s expert witness different from that relied on by the trial court and quoted above; testimony which, when viewed in accordance with principles applicable to motions for nonsuit, provides factual support for Alpert’s legal contentions substantial enough to withstand such a motion. Thus, Dr. Wexler testified that the cause of the uplifted and cracked sidewalk was the root of a tree growing on VRHA’s property. While he would not rule out the possibility that the particular root came from another location as he had not dug up the lawn all the way to the particular suspected, “mature” pine tree, it was his expert opinion that a tree growing on VRHA’s lawn was the source of the destructive root. He also testified that the trees planted in the area between the sidewalk and the street were of a different type and had characteristically smaller roots. Other witnesses testified to the size of the hazard caused by the uplifted piece of sidewalk which the tree root had created and to VRHA’s prior notice of the hazardous condition of the sidewalk. The trial court did not view the evidence adduced by plaintiff in the manner required when analyzing evidence in ruling on a motion for nonsuit made at the conclusion of a plaintiffs case-in-chief. (Freeman v. Lind, supra, 181 Cal.App.3d at p. 799, 226 Cal.Rptr. 515.)

The other aspect of the trial court’s ruling was its conclusion that VRHA did not owe a duty of care to Alpert. As we next discuss, this ruling was also error.

Whether VRHA owed a duty to pedestrians.

The fundamental legal issue raised by the judgment of nonsuit is whether VRHA as landowner and party in possession and control owed a duty to pedestrians such as Alpert to either warn them of a dangerous condition of the premises or repair it. We will conclude that such a duty was owed under the circumstances present in this case.^[FN.9]

a. Authorities prior to Alcaraz v. Vece.

The Legislature and the courts have addressed the responsibilities, if any, of possessors of land abutting sidewalks. We begin our analysis with Civil Code section 1714, subdivision (a), which makes a possessor of land subject to the general negligence standard of that section.

Civil Code section 1714, subdivision (a) provides:

“Every one is responsible, not only for the result of his willful acts, but also for an [373] injury occasioned to another by his want of ordinary care or skill in the management of his property or person, except so far as the latter has, willfully or by want of ordinary care, brought the injury on himself.”

It is appropriate to depart from this standard only when there are clear public policy reasons for doing so. In making that determination, a court must weigh the following factors: (1) the foreseeability of harm to the plaintiff, (2) the degree of certainty that the plaintiff suffered injury, (3) the proximity of the connection between the defendant’s conduct and the injury sustained, (4) the moral blame attached to the defendant’s conduct, (5) the policy of preventing future harm, (6) the extent of the burden to the defendant and consequences to the community from imposing a duty to exercise care with resulting liability for breach, and (7) the availability, cost, and prevalence of insurance for the risk involved. (Rowland v. Christian, supra, 69 Cal.2d at pp. 112 — 113, 70 Cal.Rptr. 97, 443 P.2d 561.)

The proper test to be applied to the liability of the possessor of land in accordance with section 1714 of the Civil Code is whether in the management of his property he has acted as a reasonable man in view of the probability of injury to others….” (Rowland v. Christian, supra, 69 Cal.2d at p. 119, 70 Cal.Rptr. 97, 443 P.2d 561.)

In addition to Civil Code section 1714, subdivision (a), the Legislature has enacted Streets and Highways Code section 5610, which provides:

“The owners of lots or portions of lots fronting on any portion of a public street or place when that street or place is improved or if and when the area between the property line of the adjacent property and the street line is maintained as a park or parking strip, shall maintain any sidewalk in such condition that the sidewalk will not endanger persons or property and maintain it in a condition which will not interfere with the public convenience in the use of those works or areas save and except as to those conditions created or maintained in, upon, along, or in connection with such sidewalk by any person other than the owner, under and by virtue of any permit or right granted to him by law or by the city authorities in charge thereof, and such persons shall be under a like duty in relation thereto.”

This statute places on the abutting property owner the duty to maintain the sidewalk.^[FN.10] This statutory duty has been held not to impose, by itself, a duty of care upon the abutting landowner for the safety of persons using the sidewalk, but rather a duty owed to the city.

Division Seven of this court discussed the relationship of Streets and Highway Code section 5610 to ordinary negligence principles in the course of its opinion in Jones v. Deeter (1984) 152 Cal. App.3d 798, 199 Cal.Rptr. 825 (Jones). There, plaintiff Jones tripped on a break in a sidewalk, allegedly caused by the roots [374] of a tree growing in a parkway maintained by the owner of the adjacent property. The court affirmed the trial court’s grant of summary judgment to the property owner, holding that Streets and Highways Code section 5610 was not the basis of a duty of care to pedestrians unless the sidewalk defect was the result of the owner’s negligence. (Jones, supra, at p. 803, 199 Cal.Rptr. 825.)^[FN.11] Under the facts of Jones, any dangerous condition resulting from the trees was attributable to the city as the city had planted and maintained the trees, and the parkway had been formally dedicated to the city by its owner. The court pointed out that the “Sidewalk Accident Decision” doctrine had been developed to distinguish those cases in which the owner of the adjacent property is not to be held liable in tort to users of the sidewalk unless the owner creates the condition that is a cause of the injury. (Ibid.) In Jones, the owner was not held to have a duty to the pedestrian because the city performed the maintenance of the area of the plaintiffs fall.

The Jones court was careful to distinguish the factual situation there presented — in which the offending trees were owned and maintained by the City on a dedicated parkway — from the facts of Moeller v. Fleming (1982) 136 Cal.App.3d 241, 186 Cal.Rptr. 24 (Moeller), in which that court, in reversing a grant of summary judgment, held that an abutting property owner could be held liable if the dangerous condition in a sidewalk had been caused by the roots of a tree owned by that landowner with his knowledge of that condition. (Id. at p. 245, 186 Cal. Rptr. 24.) In Moeller, the offending roots came from a tree on the defendant’s property. In distinguishing Moeller in Jones, Division Seven of this court stated: “This case turns on this distinction.” (Jones, supra, 152 Cal.App.3d at p. 804, 199 Cal. Rptr. 825.)

In Williams v. Foster (1989) 216 Cal. App.3d 510, 265 Cal.Rptr. 15 (Williams), the Court of Appeal reversed a jury verdict in favor of a pedestrian who had been injured when he fell on a public sidewalk which had an uneven surface caused by the roots of a tree planted in a parkway in front of the property owner’s residence. The defendants had moved for nonsuit, which motion the trial court had denied. In reversing the subsequent verdict and ordering that the trial court enter a judgment of nonsuit, the Williams court held that Streets & Highways Code section 5610 was controlling, viz., that the statutory duty placed on adjacent landowners to maintain and repair sidewalks was owed solely to the city and that that statute does not impose liability for injuries incurred by reason of a defect in the sidewalk. (216 Cal.App.3d at p. 521, 265 Cal. Rptr. 15.)

The Williams court did recognize the holding of Sprecher v. Adamson Companies(1981) 30 Cal.3d 358, 178 Cal.Rptr. 783, 636 P.2d 1121 (Sprecher), that a landowner may be held liable for negligent [375] failure to correct or control a defect^[FN.12] which results in injury to neighboring property. In so holding, our Supreme Court repudiated the common law rule of nonliability for natural conditions of land and held that a possessor’s liability would be determined under ordinary negligence principles. (Williams, supra, 216 Cal. App.3d at p. 519, 265 Cal.Rptr. 15.) In the Williams court’s view, the general negligence liability analysis of Sprecher was not appropriate in the circumstances there presented because the abutting owner in Williams did not own or possess an easement over the area in which the offending roots grew (or other cause arose). (Id. at pp. 520, 521, 265 Cal.Rptr. 15.)

Williams sought to distinguish Jones, criticizing it in the following language: “We fail to see any legal foundation for [the approach that a particular abutting owner could be held liable for failing to maintain the public sidewalk or parkway where abutting owners as a class rather than a city historically had performed sidewalk maintenance] if it is applied to an abutting owner who has not undertaken such maintenance in the absence of a statute or ordinance.” (Williams, supra, 216 Cal.App.3d at p. 521, 265 Cal.Rptr. 15.)

The Williams court did recognize, however, that “[a] possessor or owner of premises is under a duty to others by virtue of that possession or ownership to act reasonably to keep the premises safe and prevent persons from being injured thereby. (See Rowland v. Christian (1968) 69 Cal.2d 108, 111-119, 70 Cal.Rptr. 97, 443 P.2d 561.) Thus, where a particular abutter does not possess or own the street easement, and does not undertake maintenance of it, we see no legal basis for imposing liability for failure to properly maintain the sidewalk or planting strip in the absence of statute or ordinance.” (Williams, supra, 216 Cal.App.3d at p. 521, 265 Cal.Rptr. 15.)^[FN.13]

Of particular importance to the Williams court was the absence of any evidence that Foster or his predecessor in interest had planted the trees, or that those trees had caused the sidewalk defect (Williams, supra, 216 Cal.App.3d at pp. 522-523, 265 Cal.Rptr. 15.) Thus, there was no factual basis in Williams to consider or apply the duty analysis and the principles of Rowland v. Christian, supra, 69 Cal.2d. at p. 119, 70 Cal.Rptr. 97, 443 P.2d 56

b. Impact of Alcaraz v. Vece.

Prior to trial in the instant case our Supreme Court had occasion to apply the principles of Rowland v. Christian, supra, 69 Cal.2d 108, 70 Cal.Rptr. 97, 443 P.2d 561, in a situation analogous in many respects to the instant case. In Alcaraz v. Vece (1997) 14 Cal.4th 1149, 60 Cal.Rptr.2d 448, 929 P.2d 1239 (Alcaraz), Alcaraz sued his landlord, the owner of the apartment building in which he resided, for injuries sustained when Alcaraz stepped into an open utility meter box located in the city-owned lawn next to the sidewalk in front of that residence. In affirming the Court of Appeal’s reversal of the grant of summary judgment to the property owner, our Supreme Court held that there was a triable [376] issue of fact as to whether the property owner had exercised control over the area in which the utility box was located even though that area was owned by the city. In our Supreme Court’s view, if the property owner did exercise such control, then it had a duty to warn Alcaraz^[FN.14] of the danger, or protect him from that danger.

Citing its decision in Rowland v. Christian, the Supreme Court stated: “`The proper test to be applied to the liability of the possessor of land … is whether in the management of his property [the possessor] has acted as a reasonable man in view of the probability of injury to others….’ (Rowland v. Christian (1968) 69 Cal.2d 108, 119 [70 Cal.Rptr. 97, 443 P.2d 561].)” (Alcaraz, supra, 14 Cal.4th at p. 1156, 60 Cal.Rptr.2d 448, 929 P.2d 1239.)

The court further explained: “This duty to maintain land in one’s possession in a reasonably safe condition exists even where the dangerous condition on the land is caused by an instrumentality that the landowner does not own or control.” (Alcaraz, supra, 14 Cal.4th at p. 1156, 60 Cal.Rptr.2d 448, 929 P.2d 1239.)

We distill from our Supreme Court’s holding in Alcaraz supra, that a landowner or possessor of land has a duty to take reasonable measures to protect persons from dangerous conditions on adjoining land when the landowner or possessor exercises possession or control over that adjacent land. The scope of this duty is to be determined under principles enunciated in Rowland v. Christian, supra. “The proper test to be applied to the liability of the possessor of land … is whether in the management of his property he has acted as a reasonable man in view of the probability of injury to others….” (69 Cal.2d at p. 119, 70 Cal.Rptr. 97, 443 P.2d 561.)

c. Indicia of control over the land.

The facts of this case reveal that VRHA had planted and maintained all of the trees and vegetation in the area, on both sides of the sidewalk, had installed sprinklers on both sides of that walkway, and watered and trimmed the trees which grew the roots which caused the sidewalk to be uplifted and crack, presenting the danger which befell Alpert.^[FN.15] Further, VRHA had known for approximately two years prior to Alpert’s fall of the condition of the sidewalk at the location of the fall and elsewhere along that path.

Because the area of the injury in Alcaraz was owned by the city and not by the defendant, our Supreme Court was required to consider whether a possessor of land could be held liable under tort principles. Concluding in the affirmative, the court relied on principles enunciated in Rowland v. Christian, supra, 69 Cal.2d at p. 119, 70 Cal.Rptr. 97, 443 P.2d 561: The relevant question is not “mere ownership,” but whether the possessor has maintained the property in a reasonably safe condition. (Accord, Alcaraz, supra, 14 Cal.4th at p. 1156, 60 Cal.Rptr.2d 448, 929 P.2d 1239.)

[377] In the instant case, the party which had done the things just enumerated and which had prior knowledge of the resulting dangerous condition was in possessor and control of the premises, including but not limited to the sidewalk on which Alpert fell.

d. Application of Alcaraz and other cases.

VRHA contends that Jones does not allow for a duty to be placed on an adjacent landowner to repair or warn under the circumstances presented in this case. VRHA’s reliance on Jones is misplaced. As stated in Jones: “In settings where the abutting owners have planted the trees or have habitually trimmed or cared for them, these abutting owners have the duty to maintain the trees in a safe condition toward pedestrians.” (Jones, supra, 152 Cal.App.3d at p. 805, 199 Cal.Rptr. 825.) The facts of the instant case, unlike those of Jones, show the substantial activities — and responsibility — of the abutting landowner.

Similarly, VRHA’s reliance on Contreras v. Anderson (1997) 59 Cal.App.4th 188, 69 Cal.Rptr.2d 69 (Contreras), is misplaced. In Contreras, the plaintiff slipped on an improperly sloped brick path which led from the street curb to the sidewalk in the front of the defendant homeowners’ residence. The area of the fall was owned by the city and separated from the sidewalk by a five-foot high wooden fence. (Id at p. 192,69 Cal.Rptr.2d 69.) In the course of its de novo review of the summary judgment granted to defendants, the court analyzed Alcaraz, noting that while the defendant inAlcaraz exercised control over the parkway in which the fall had occurred, by contrast, the defendants in Contreras did not own, or have legal possession of the area of the fall (Contreras, supra, at p. 197, 69 Cal.Rptr.2d 69). The Contreras court described the difference: “The city-owned strip [in Alcaraz ] … was contiguous with and indistinguishable from the rest of the defendant’s lawn…. [T]he evidence showed the defendants maintained the entire lawn from the defendants’ property line to the sidewalk, including that portion of the lawn located within the city-owned strip of land, and that, subsequent to the plaintiffs alleged injury, defendants constructed a fence that bordered the sidewalk and enclosed the entire lawn in front of their property, including the two-foot-wide strip owned by the city.” In addition, the Alcaraz court found that the defendants had actual notice of the defect. (Contreras, supra, at p. 197, 69 Cal.Rptr.2d 69.)

The Contreras court characterized the holding in Alcaraz as follows: “The Alcarazcourt concluded that such evidence was ‘sufficient to raise a triable issue of fact as to whether defendants exercised control over the strip of land … and thus owed a duty of care to protect or warn plaintiff….’ [¶] Nevertheless, it is clear from Alcarazthat simple maintenance of an adjoining strip of land owned by another does not constitute an exercise of control over that property.” (Contreras, supra, 59 Cal.App.4th at p. 198, 69 Cal.Rptr.2d 69.) The Contreras court focused also on the fact that the defendants in Alcaraz had constructed a fence around the area. This act “went beyond simple neighborly maintenance and, thus, was sufficient to raise a triable issue of fact as to control. [Citation.]” (Id at p. 199, 69 Cal.Rptr.2d 69.)

By contrast, in Contreras, there “is no such `dramatic assertion of a right normally associated with ownership or … possession’ of the land….” (Id at p. 200, 69 Cal.Rptr.2d 69.) Finally, the Contreras [378] court focused on the fact that the fence in that case had been constructed by the city and that there was no evidence the defendants had knowledge of the hazard. (Id. at p. 201, 69 Cal.Rptr.2d 69.)

The facts of the instant case are substantially different from those presented inContreras. In Contreras, the court found that the adjacent owner had neither possession of, nor control over, the land on which the dangerous condition existed. In the instant case, the adjoining land was owned by VRHA which exercised control over the sidewalk and the area between the sidewalk and the curb. VRHA installed sprinklers, and planted and maintained the trees which Alpert’s expert testified caused the dangerous condition in the sidewalk. Further, VRHA had been aware of the condition of the sidewalk for a substantial period of time prior to the fall (and was in the process of discussing repairs when Alpert fell). In short, there was enough evidence to overcome the motion for nonsuit.^[FN.16]

Denial of the request to reopen.

When the trial court indicated it was going to grant the nonsuit, counsel for plaintiff sought leave to reopen. The trial court denied that request.

Alpert’s motion to reopen was timely under the circumstances. Although it was not made the instant the motion for nonsuit was served, it was made in the course of the discussion with the court and the argument of counsel that followed the filing of that motion. In addition, Alpert had previously asked for opportunities to make offers of proof on matters which were relevant to the issues presented in the motion for nonsuit and had been told by the court time would be made available later for such offers. Those requests related to evidence of knowledge by VRHA of the existence of the sidewalk defects at least a month prior to Alpert’s fall. That time never came.

The denial of a request to reopen which is accompanied by an offer of proof of the evidence that will cure the deficiency is reversible error. (Consolidated World Investments, Inc. v. Lido Preferred Ltd. (1992) 9 Cal.App.4th 373, 382, 11 Cal. Rptr.2d 524; Eatwell v. Beck, supra, 41 Cal.2d at pp. 133-134, 257 P.2d 643[plaintiffs, who had mistakenly relied on former law regarding damages, were improperly denied leave to introduce evidence to satisfy the current rule].)

The right to present further evidence is waived unless the plaintiff both requests leave to reopen and makes an offer of proof, describing the evidence and explaining how it would cure the deficiencies. (Consolidated World Investments, Inc., v. Lido Preferred Ltd., supra, 9 Cal. App.4th at p. 382, 11 Cal.Rptr.2d 524.) In the instant case, Alpert complied with the rule to the extent possible.

It is important to recognize, however, that even if Alpert had been granted [379] leave to reopen and introduce all of the evidence we have discussed, the trial court would likely still have granted the nonsuit as its legal analysis would have remained unchanged. There does not appear to have been anything in the evidence referenced in the offers of proof which would have changed the legal theory upon which the trial court granted the judgment of nonsuit. On retrial, it appears that the previously excluded evidence may be probative and relevant to the issues in the case.

The trivial defect ruling.

One of the bases of VRHA’s written motion for nonsuit was that the defect in the sidewalk was trivial and thus it was not foreseeable that harm would come to anyone. In its reply brief, VRHA asserts that the trial court in fact rejected VRHA’s argument that the defect was trivial. Because VRHA, in effect, has conceded that the trial court rejected this argument, we need not consider it.^[FN.17]

Causation

The final ground for the motion for nonsuit was that Alpert had not established that any defect was caused by a root from VRHA’s property. As we have discussed at length, ante, in reviewing a judgment of nonsuit we view the evidence in the light most favorable to the plaintiff and accept as credible the testimony of the plaintiffs witnesses. (Kidron v. Movie Acquisition Corp., supra, 40 Cal.App.4th at p. 1581, 47 Cal.Rptr.2d 752; LaMonte v. Sanwa Bank California, supra, 45 Cal.App.4th at p. 517, 52 Cal.Rptr.2d 861.) Alpert’s expert clearly stated his opinion that the break in the sidewalk was the result of the growth under the sidewalk of a root of one of the pine trees planted on VRHA’s lawn and nurtured by VRHA. For purpose of ruling on a judgment of nonsuit, there was substantial evidence of causation. VRHA’s causation argument is without merit.

Exclusion of evidence of prior knowledge of the condition of the sidewalk contained in the minutes of meetings of VRHA’s board of directors.

There is an evidentiary contention of Alpert which is appropriately resolved on this appeal. Alpert contends the trial court erred in refusing to permit questioning of VRHA board of director and committee members about a discussion at VRHA’s November 1997 board of directors’ meeting. The trial court sustained [380] VRHA’s objections to such questions and to Alpert’s attempt to gain admission of the minutes of that meeting of VRHA’s board of directors. The basis for the objection was that admission of such evidence would violate the subsequent act proscription codified in Evidence Code section 1151. We will determine that the evidence should have been admitted.

Alpert sought admission of the November minutes while questioning the former president of VRHA’s board of directors, Ehihu Crane, about that meeting. During that questioning, Alpert sought to inquire concerning a discussion of bids to repair sidewalk “bumps.” Alpert was specifically interested in references in that discussion and in the minutes of that meeting to the fact that there had been a discussion of the condition of the sidewalk and the need to repair it at a board of directors’ meeting in June of the same year, prior to Alpert’s fall.^[FN.18] The trial court sustained objections to introduction of this evidence.

Alpert seeks to overturn those rulings, arguing the evidence is probative of the facts that the sidewalk defect was known to VRHA prior to the fall, the defect was not trivial, its repair was feasible, the defect was caused by tree roots, and VRHA was in control of the cause of the defect as well as of its repair. In arguing that the trial court’s ruling was correct, VRHA contended that the evidence would relate to remedial steps taken after the fall, and is not probative on the points argued by Alpert.

In Alcaraz, supra, 14 Cal.4th 1149, 60 Cal.Rptr.2d 448, 929 P.2d 1239, the defendants had objected in the trial court to admission of evidence that they had maintained the area of that fall and that they had built a fence around the parkway where the fall had occurred subsequent to that incident. In making this objection, theAlcaraz defendants argued that the evidence must be excluded under the authority of Evidence Code section 1151 which precludes introduction of evidence of subsequent remedial conduct.^[FN.19] In its ruling granting summary judgment to the defense, that trial court had sustained defendants’ objections in this regard.

[381] The Supreme Court expressly rejected these evidentiary rulings, stating, “This evidence [relating to maintenance of the lawn on city-owned property and subsequent construction of a fence in that area] was highly relevant regarding whether defendants exercised control over the strip of land owned by the city.” (Alcaraz, supra, 14 Cal.4th at p. 1166, 60 Cal.Rptr.2d 448, 929 P.2d 1239.)

“[W]hether defendants exercised control over the strip of land owned by the city on which the meter box was located is a `disputed fact that is of consequence to the determination of the action.’ [Citation.] Indeed, if defendants exercised control over this strip of land, it appears clear they owed a duty to protect or warn plaintiff.” (Alcaraz, supra, 14 Cal.4th at p. 1167, 60 Cal.Rptr.2d 448, 929 P.2d 1239.)

In rejecting the argument that admission of evidence that the defendants later constructed a fence around the area of the fall violated Evidence Code section 1151, the court stated: “This statute does not apply, however, because evidence regarding construction of the fence was admitted, not to prove negligence, but to demonstrate that defendants exercised control over the strip of land owned by the city. As we stated in Ault v. International Harvester Co. (1974) 13 Cal.3d 113, 118, 117 Cal.Rptr. 812, 528 P.2d 1148, `Section 1151 by its own terms excludes evidence of subsequent remedial or precautionary measures only when such evidence is offered to prove negligence or culpable conduct’ (Italics added; see also Fed. Rules Evid., rule 407, 28 U.S.C., which employs language nearly identical to Evidence Code section 1151 and then explains: `This rule does not require the exclusion of evidence of subsequent measures when offered for another purpose, such as proving ownership, control, or feasibility of precautionary measures, if controverted, or impeachment.’)” (Alcaraz, supra, 14 Cal.4th at p. 1169, 60 Cal.Rptr.2d 448, 929 P.2d 1239.)

The VRHA minutes were admissible for the purposes sought by Alpert. The proper means to address the concern expressed by VRHA would have been a limiting instruction, advising the jury of the purposes for which they could, and could not, consider the minutes. (See Morehouse v. Taubman Co. (1970) 5 Cal.App.3d 548, 555, 85 Cal.Rptr. 308 [evidence that the defendant contractor’s carpenters installed handrails at the point where the plaintiff had fallen after his injury was not admissible to prove negligence of the defendant under Evid.Code, § 1151, but was properly limited and received by the court, on the issues of control of the premises, and of whose duty it was under the contract to take such safety measures].) Similarly, in Baldwin Contracting Co. v. Winston Steel Works, Inc. (1965) 236 Cal.App.2d 565, 46 Cal. Rptr. 421, the court held that subsequent remedial conduct cannot be considered on the issue of liability, but “is relevant and admissible [on the issues of scope of duty] [citation] and also on the possibility or feasibility of eliminating the cause of the accident. [Citations.]”^[FN.20] (Baldwin Contracting, at p. 573, 46 Cal.Rptr. 421.)

In the present case, the minutes of the November board meeting confirm VRHA’s knowledge of the sidewalk defect prior to Alpert’s fall, VRHA’s discussions regarding [382] repair, its control over the area at issue, as well as other facts that were in dispute in the litigation. The trial court erred in refusing to admit the minutes and in sustaining objections to questions of witnesses in the same areas.^[FN.21] As our Supreme Court stated in Alcaraz, such evidence “would be admissible to demonstrate that defendants exercised control over the premises. Accordingly, we may consider such evidence in determining whether a triable issue of material fact existed concerning whether defendants exercised control over the strip of land and thus owed a duty of care to plaintiff.” (Alcaraz, supra, 14 Cal.4th at p. 1170, 60 Cal. Rptr.2d 448, 929 P.2d 1239.)

DISPOSITION

The judgment of nonsuit is reversed. The matter is remanded to the trial court for further proceedings consistent with this opinion. Appellant shall recover her costs on appeal.

BOREN, P.J., and NOTT, J., concur.

[FN.*] Judge of the Los Angeles Superior Court, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.

[FN.1] Alpert had alleged causes of action against the City of Los Angeles and County of Los Angeles as well as VRHA. The claims against the governmental entity defendants were resolved prior to trial. The County of Los Angeles was dismissed; a good faith settlement was entered with the City of Los Angeles.

[FN.2] We construe the dismissal of the jury upon the granting of the motion for nonsuit as a termination of the action as to all defendants. It is proper, therefore, to treat the appeal as an appeal from the judgment which necessarily followed. (See Mikialian v. City of Los Angeles (1978) 79 Cal.App.3d 150, 153, 144 Cal.Rptr. 794; Graski v. Clothier (1969) 273 Cal.App.2d 605, 607, 78 Cal.Rptr. 447.)

[FN.3] Alpert also sought review of the trial court’s refusal to permit a representative of the City of Los Angeles to testify. Resolution of that evidentiary matter is not necessary on this appeal. We make further reference to this matter in footnote 10, post.

[FN.4] At the time of trial in this matter, Code of Civil Procedure section 581c, subdivision (a) provided:

“After the plaintiff has completed his or her opening statement, or the presentation of his or her evidence in a trial by jury, the defendant, without waiving his right to offer evidence in the event the motion is not granted, may move for a judgment of nonsuit.”

The section was amended in 1998 (Stats. 1998, ch. 200, § 1) in a technical manner not relevant to the instant case.

[FN.5] VRHA correctly points out that the doctrine that a scintilla of evidence creates a sufficient evidentiary basis to reverse a judgment of nonsuit has been rejected. (7 Witkin, Cal. Procedure (4th ed. 1997) Trial, § 420, p. 481.) While that is a correct statement of the law, factually Alpert overcame that threshold for reasons we discuss in the text.

[FN.6] California Constitution, article I, section 16 provides, in part:

“Trial by jury is an inviolate right and shall be secured to all….”

This right extends to factual questions only; issues of law are triable by the court. (Evid. Code, § 310, subd. (a); Code Civ. Proc., §§ 589, 591, 592.) The right to trial by jury guarantees that right in actions triable by jury at common law, including claims for damages for injuries to persons. (See generally 7 Witkin, Cal. Procedure (4th ed. 1997) Trial, § 89 et seq.)

[FN.7] In its written motion for judgment of nonsuit, VRHA contended that (1) the defect in the sidewalk was trivial as a matter of law, (2) Alpert had failed to establish that the cause of the sidewalk defect was a root growing from VRHA’s property, and (3) VRHA owed no duty to pedestrians such as Alpert, but only to the City of Los Angeles, under Streets and Highways Code section 5610.

[FN.8] There is a split of authority over whether we may consider grounds argued by the defendant, but not relied upon by the trial court, in granting the motion. Some Courts of Appeal, including this division, have held that appellate review is limited to those grounds relied upon by the trial court, the theory being that we only need examine those grounds which a plaintiff may have been able to correct had they been called to its attention (e.g., DeVaughn Peace, M.D., Inc. v. St. Francis Medical Center (1994) 28 Cal.App.4th> 454, 459, 33 Cal.Rptr.2d 459; Walker v. Porter (1974) 44 Cal.App.3d 174, 177, 118 Cal.Rptr. 468). Other courts have taken the view that a judgment of nonsuit can be sustained on any ground specified in the motion, even if not relied upon by the trial court (e.g.,Saunders v. Taylor (1996) 42 Cal.App.4th 1538, 1542, fn. 2, 50 Cal.Rptr.2d 395, and cases there discussed). See also Adkins v. State of California (1996) 50 Cal.App.4th 1802, 1809, fn. 7, 59 Cal.Rptr.2d 59.

The source of this debate is the following language from Lawless v. Calaway (1944) 24 Cal.2d 81, 147 P.2d 604 (Lawless): “The correct rule is that grounds not specified in a motion for nonsuit will be considered by an appellate court only if it is clear that the defect is one which could not have been remedied had it been called to the attention of plaintiff by the motion. This rule is complementary to the requirement that a party specify the grounds upon which his motion for nonsuit is based.” (Id. at p. 94, 147 P.2d 604; accord, Timmsen v. Forest E. Olson, Inc. (1970) 6 Cal.App.3d 860, 868, 86 Cal.Rptr. 359.) The rationale for Lawless is that, on a motion for nonsuit, the plaintiff is to be given the opportunity to cure the defect in its case. To this end, the court is required to hear offers of proof and grant a motion to reopen if timely made. (Eatwell v. Beck (1953) 41 Cal.2d 128, 133, 257 P.2d 643[one of the chief objects of a nonsuit motion is to point out to plaintiff the defects in its case so that they may be remedied and the case decided on its merits].)

The articulation of the Lawless rule has not prevented the split of authorities as discussed above: whether, on review of a judgment of nonsuit, the appellate court looks only at the reason or reasons stated by the trial judge in granting the motion, or at any reason advanced by the moving party in the trial court. In either situation, the appellate court looks also at the problem of legal preclusion — whether, as a matter of law, there is no basis for the plaintiff’s claim. In such a circumstance, affirmance of the judgment of nonsuit is appropriate even if that ground was not advanced below. It is the issue of legal preclusion that was the principal focus of the trial court in reaching its ruling below.

[FN.9] As indicated in this opinion, the existence of a duty of care is a matter of law. (Ann M. v. Pacific Plaza Shopping Center (1993) 6 Cal.4th 666, 678, 25 Cal.Rptr.2d 137, 863 P.2d 207; Isaacs v. Huntington Memorial Hospital (1985) 38 Cal.3d 112, 125, 211 Cal.Rptr. 356, 695 P.2d 653.) The foreseeability of a particular plaintiff’s injury is a question of fact. (Isaacs, at p. 126, 211 Cal.Rptr. 356, 695 P.2d 653.) The standard to be applied to determine if the duty has been met is whether the property owner has acted in management of the property as a reasonable person in view of the probability of injury to others. (Rowland v. Christian (1968) 69 Cal.2d 108, 118-119, 70 Cal.Rptr. 97, 443 P.2d 561.) The answer to that question will be determined on retrial.

[FN.10] Streets and Highways Code section 5610 is one of several statutes codifying responsibilities with respect to maintenance and repair of sidewalks. Section 5611 gives to the superintendent of streets the authority to notify the abutting owner of the need to repair the sidewalk. Section 5615 provides that the superintendent of streets may repair the sidewalk if the abutting owner does not and assess that cost to the abutting owner. That amount may result in a lien against the property. (Sts. & Hy.Code, § 5625 et seq.)

In this case, Alpert’s attempt to introduce evidence regarding the absence of notice to the city concerning defects in the sidewalk was rejected. Alpert did give timely notice of intention to call the witness through whose testimony this and other matters were to be established. Whether the witness was competent to testify to all of the subjects which Alpert indicated in her offer of proof is a matter for consideration by the trial court in the course of proceedings on the retrial.

[FN.11] As we discuss in the text, Streets and Highway Code section 5610 establishes the rule that the owner of the property adjoining the sidewalk has a duty to maintain it. This is a statutory exception to the general rule that the owner of the easement (typically, the local municipality) has the duty to maintain the easement.

While section 5610 places the duty to maintain and repair defects in the sidewalk on the abutting landowner, the “Sidewalk Accident Decision” doctrine provides that that duty is not owed to persons who use the sidewalk unless the abutting landowner somehow causes the dangerous condition of the sidewalk. (Schaefer v. Lenahan (1944) 63 Cal. App.2d 324, 326, 146 P.2d 929; Jones, supra, 152 Cal.App.3d at p. 803, 199 Cal.Rptr. 825.) Our holding today is consistent with this long-established doctrine.

[FN.12] In Sprecher, supra, 30 Cal.3d at p. 358, 178 Cal.Rptr. 783, 636 P.2d 1121, the defect was a landslide.

[FN.13] The Williams court ultimately reversed the judgment and directed the trial court to enter a judgment of nonsuit for the reason that the evidence was insufficient as a matter of law to sustain a verdict for the plaintiff. (Williams, supra, 216 Cal.App.3d at pp. 522-523, 265 Cal.Rptr. 15.) We reach a different conclusion based both on the facts of this case, which the Williams court suggested might be the basis for such a result, and due to the development in the law subsequent to the decision in Williams.

[FN.14] This duty is owed to Alcaraz and to others, viz., to persons who foreseeably may be in the area, not to Alcaraz due to his status as a tenant of the landowner. (Rowland v. Christian, supra, 69 Cal.2d at p. 119, 70 Cal.Rptr. 97, 443 P.2d 561; Alcaraz, supra, 14 Cal.4th at pp. 1162-1163, 60 Cal.Rptr.2d 448, 929 P.2d 1239 [duty is not dependent on commercial benefit to landowner].)

[FN.15] As indicated in the text, ante, Alpert’s expert witness was of the opinion that the offending root came from a pine tree growing between the sidewalk and the buildings.

[FN.16] No evidence was presented below of any applicable local ordinances. Whether that will be a factor on retrial in unknown. We note that in Selger v. Steven Brothers, Inc. (1990) 222 Cal.App.3d 1585, 272 Cal.Rptr. 544, the court construed statutes applicable in the jurisdiction in which the property at issue in this appeal is located. The issue was framed differently, however, as that defendant had no role in creating the hazard which befell that plaintiff. (Id. at p. 1592, 272 Cal. Rptr. 544.) Nor was any evidence presented regarding the statutory presumptions of Civil Code sections 831 and 1112. (See Jones, supra, 152 Cal.App.3d at pp. 801-802, 199 Cal.Rptr. 825.)

[FN17] This court has had previous opportunities to consider the trivial defect defense. In Ursino v. Big Boy Restaurants of America (1987) 192 Cal.App.3d 394, 237 Cal.Rptr. 413, we sustained a summary judgment in which the trial court had determined that the trivial defect defense was established as a matter of law based on the facts there presented. (Id. at pp. 397-398, 237 Cal.Rptr. 413). In Davis v. City of Pasadena (1996) 42 Cal.App.4th 701, 50 Cal.Rptr.2d 8, we upheld a summary judgment in which the trial court had reasoned that “`”reasonable minds [could] come to but one conclusion,”‘” that the design of a staircase at a city convention center posed a minor or trivial risk at most. (Id. at p. 704, 50 Cal.Rptr.2d 8.)

We note that the trial court in the instant case had rejected VRHA’s argument that the trivial risk doctrine applied on the facts presented and that VRHA has conceded this issue in its brief on appeal. Nevertheless, as that defense is fact-specific and there will be a full trial, our opinion should not be construed as other than an indication that the trial court may consider this issue based on the evidence adduced in the new trial of this case. Nor do we infer that the trivial defect defense need not be closely scrutinized in view of the “marked changes in the law” made by Rowland v. Christian, supra, 69 Cal.2d 108, 70 Cal.Rptr. 97, 443 P.2d 561. (Ursino v. Big Boy Restaurants of America, supra, 192 Cal. App.3d at p. 398, 237 Cal.Rptr. 413.)

[FN.18] When Alpert sought to have the minutes in question marked as trial exhibit 29, VRHA’s counsel asked to approach. After the reported sidebar conference, the minutes were never marked. They should have been marked for identification. The parties to this appeal each make reference to those minutes, even though they are not a part of the record on appeal. By their briefs on this appeal, we are advised that the minutes of the VRHA board of directors state in part:

“The meeting was called for the purpose of discussing the bids for cement work to repair the … sidewalk `bumps.’

“Before discussing the bids the question was raised as to whether or not this work is considered an `emergency’ and therefore did not need approval of homeowners (over $5,000). The Board voted 2 to 1 (1 abstention) that is as [sic] not an emergency, since the matter has been pending since last June….

“… In several places the cement levels have change [sic] due to tree root, etc.

Alpert sought introduction of these minutes to establish knowledge of the problem by VRHA at least a month prior to her fall. VRHA objected, contending the evidence was of subsequent repair and inadmissible by statute and common law policy.

Two other attempts were made to introduce the minutes, with the same result, the court sustaining the objection that the minutes were inadmissible as evidence of subsequent repair and citing Evidence Code section 352, which gives the trial court the discretion to exclude evidence on the basis that its probative value is outweighed by its prejudicial impact. Each ruling was incorrect.

[FN.19] Evidence Code section 1151 provides:

“When, after the occurrence of an event, remedial or precautionary measures are taken, which, if taken previously, would have tended to make the event less likely to occur, evidence of such subsequent measures is inadmissible to prove negligence or culpable conduct in connection with the event.”

[FN.20] Pursuant to Evidence Code section 355, the opponent of the evidence (or its propoadvising the jury that the evidence is being admitted for a limited purpose, explaining that purpose. This instruction may be given at the time the evidence is admitted, in closing instructions, or both. (See Evid.Code, § 355; Dincau v. Tamayose (1982) 131 Cal.App.3d 780, 791, 182 Cal.Rptr. 855.)

[FN.21] Because of the manner in which the issue arose, we do not know if other evidentiary objections (e.g., relating to authenticity of the minutes) could be surmounted by Alpert. These are issues to be resolved by the trial judge on retrial.

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