Judge: Donald F. Gaffney, Case: Mt. San Antonio Homeowners Association v. Murrietta, Date: 2023-08-09 Tentative Ruling
TENTATIVE RULING:
For the reasons set forth below, Defendants Albert G. Murrietta and Helen Murrietta’s Motion for Summary Judgment or Summary Adjudication of Issues is DENIED.
A. Statement of Law
“The purpose of the law of summary judgment is to provide courts with a mechanism to cut through the parties’ pleadings in order to determine whether, despite their allegations, trial is in fact necessary to resolve their dispute.” (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 843.) “A party may move for summary judgment in an action or proceeding if it is contended that the action has no merit or that there is no defense to the action or proceeding.” (Code Civ. Proc., § 437c, subd. (a)(1)[1].) “The motion for summary judgment shall be granted if all the papers submitted show that there is no triable issue as to any material fact and that the moving party is entitled to a judgment as a matter of law. In determining if the papers show that there is no triable issue as to any material fact, the court shall consider all of the evidence set forth in the papers, except the evidence to which objections have been made and sustained by the court, and all inferences reasonably deducible from the evidence, except summary judgment shall not be granted by the court based on inferences reasonably deducible from the evidence if contradicted by other inferences or evidence that raise a triable issue as to any material fact.” (§ 437c, subd. (c).)
“A party may move for summary adjudication as to one or more causes of action within an action, one or more affirmative defenses, one or more claims for damages, or one or more issues of duty, if the party contends that the cause of action has no merit, that there is no affirmative defense to the cause of action, that there is no merit to an affirmative defense as to any cause of action, that there is no merit to a claim for damages, as specified in Section 3294 of the Civil Code, or that one or more defendants either owed or did not owe a duty to the plaintiff or plaintiffs. A motion for summary adjudication shall be granted only if it completely disposes of a cause of action, an affirmative defense, a claim for damages, or an issue of duty.” (§ 437c, subd. (f)(1); R.J. Land & Associates Construction Co. v. Kiewit-Shea (1999) 69 Cal.App.4th 416, 424.) “A motion for summary adjudication may be made by itself or as an alternative to a motion for summary judgment and shall proceed in all procedural respects as a motion for summary judgment.” (§ 437c, subd. (f)(2).)
“If a motion for summary adjudication is granted, at the trial of the action, the cause or causes of action within the action, affirmative defense or defenses, claim for damages, or issue or issues of duty as to the motion that has been granted shall be deemed to be established and the action shall proceed as to the cause or causes of action, affirmative defense or defenses, claim for damages, or issue or issues of duty remaining.” (§ 437c, subd. (n)(1).)
For purposes of a motion for summary adjudication, “A defendant or cross-defendant has met his or her burden of showing that a cause of action has no merit if the party has shown that one or more elements of the cause of action, even if not separately pleaded, cannot be established, or that there is a complete defense to the cause of action. Once the defendant or cross-defendant has met that burden, the burden shifts to the plaintiff or cross-complainant to show that a triable issue of one or more material facts exists as to the cause of action or a defense thereto. The plaintiff or cross-complainant shall not rely upon the allegations or denials of its pleadings to show that a triable issue of material fact exists but, instead, shall set forth the specific facts showing that a triable issue of material fact exists as to the cause of action or a defense thereto.” (§ 437c, subd. (p)(2).)
“Second, and generally, the party moving for summary judgment bears an initial burden of production to make a prima facie showing of the nonexistence of any triable issue of material fact; if he carries his burden of production, he causes a shift, and the opposing party is then subjected to a burden of production of his own to make a prima facie showing of the existence of a triable issue of material fact.” (Aguilar, supra, 25 Cal.4th at p. 850; § 437c, subd. (p)(1) [plaintiff meets its burden by proving each element of its cause of action].) Unless the moving party meets its initial burden, summary judgment cannot be ordered, even if the opposing party has not responded sufficiently, or at all. (Vesely v. Sager (1971) 5 Cal.3d 153, 169-170, superseded by statute on another point, as noted in Ennabe v. Manosa (2014) 58 Cal.4th 697, 701, 707; FSR Brokerage, Inc. v. Superior Court (1995) 35 Cal.App.4th 69, 73, fn. 4.)
B. Requests for Judicial Notice
a. The Court Grants Defendants’ Requests for Judicial Notice
With their MSJ, Defendants ask the Court to take judicial notice of: (Exhibit 1) The Subdivision Map for Tract 15501; (Exhibit 2) The CC&R’s, and (Exhibit 3) The Final Subdivision Public Report for Tract 15501.
The Court grants these requests, as the Court may take judicial notice of documents recorded with the county recorder. (Ragland v. U.S. Bank Nat. Assn. (2012) 209 Cal.App.4th 182, 194; McElroy v. Chase Manhattan Mortgage Co. (2005) 134 Cal.App.4th 388, 394; Evid. Code, § 452, subd. (c).)
b. The Court Grants Plaintiff’s Requests for Judicial Notice
With its Opposition, Plaintiff requests the Court take judicial notice of: (Exhibit A) The August 3, 1999, Resolution no. 99-3291 of the City Council of the City of Yorba Linda; (Exhibit B) The August 3, 2003, Subdivision Map for Tract 15501; (Exhibit C) the November 5, 2003, Grant Deed of Lots 6 and 7; (Exhibit D) the HOA’s Articles of Incorporation; (Exhibit E) the HOA’s CCR’s; (Exhibit F) the March 19, 2004, Grant Deed of Tract 15501 to Plaintiff; and (Exhibit G) the April 5, 2005, Easement Grant Deed.
First, the Court can take judicial notice of a City Council Resolution. Thus, the Court takes judicial notice of Exhibit A. (Shapiro v. Board of Directors of Centre City Development Corp. (2005) 134 Cal.App.4th 170, 174, fn. 2; Evid. Code, § 452, subd. (b).)
Second, Exhibits B, C, E, F, and G are recorded documents, which are subject to judicial notice. (Ragland, supra, 209 Cal.App.4th at p. 194.) The Court can also take judicial notice of the HOA’s CC&R’s, the HOA’s articles of incorporation, and grant deeds. (Lauckhart v. El Macero Homeowners Association (2023) 92 Cal.App.5th 889, 897.) Thus, the Court takes judicial notice of Exhibits C-G.
C. Evidentiary Objections
With its Opposition, Plaintiff objects to paragraphs 3 to 6 of the Declaration of Albert G. Murrietta, including Exhibit A-C of the Murrietta Declaration, as well as paragraph 3 and Exhibit 3 to the Request for Judicial Notice.
The Court sustains Objection no. 2 (Murrietta Declaration, ¶ 4; Exhibit A to Murrietta Declaration) and Objection no. 4 (Murrietta Declaration, ¶ 6; Exhibit C to Murrietta Declaration)
Defendants are attempting to prove the contents of two communications that support Defendants’ contention they are not subject to the CC&R’s. (Murrietta Declaration, ¶¶ 4, 6; Exhibits A, C to Murrietta Declaration.) This is hearsay. (In re Golden’s Estate (1935) 4 Cal.2d 300, 307; see McCoy v. Gustafson (2009) 180 Cal.App.4th 56, 77-78 [contents of letter were hearsay]; see Tuchscher Development Enterprises, Inc. v. San Diego Unified Port Dist. (2003) 106 Cal.App.4th 1219, 1238 [declaration recounting a company’s report regarding the contents of its database consists of hearsay].)
In their response to the evidentiary objections, Defendants contend, while the truth of the communications are not binding on the court in interpreting the CC&R’s, it is probative and relevant to why Defendants are of the belief they were not subject to the CC&R’s. Regardless of what Defendants’ state of mind might have been when they received Exhibits A and C, Defendants rely on paragraphs 4 and 6 of the Murrietta Declaration to establish they were not subject to the CC&R’s. (See Issue No. 3, Material Fact nos. 21, 23-24.) In other words, contrary to what Defendants claim in their response to the evidentiary objections, Defendants are attempting to use Exhibits A and C for the truth of the matters asserted.
The Court overrules Objection no. 3 (Murrietta Declaration, ¶ 5; Exhibit B to Murrietta Declaration) The letter appears to be from counsel for the Association, meaning it falls under the hearsay exemption for party admissions. (Evid. Code, § 1220; see Bell v. Staacke (1911) 159 Cal. 193, 196-197 [letter party’s attorney was admissible in evidence as an admission of the attorney of record of the party while he was such attorney]; see Fibreboard Paper Products Corp. v. East Bay Union of Machinists, Local 1304, United Steelworkers of America, AFL-CIO (1964) 227 Cal.App.2d 675, 707 [stipulations and other statements by attorneys within scope of their authority admissible as party admissions]; see GemCap Lending, LLC v. Quarles & Brady, LLP (C.D. Cal. 2017) 269 F.Supp.3d 1007, 1025, aff'd sub nom. GemCap Lending I, LLC v. Quarles & Brady, LLP (9th Cir. 2019) 787 Fed.Appx. 369 [letter from counsel falls under hearsay exemption for opposing party statements].)
The Court overrules Objection no. 1 (Murrietta Declaration, ¶ 3), as Defendant Albert G. Murrietta has personal knowledge regarding the history of Defendants’ ownership in the subject tract of land, and this paragraph provides background as to why Defendants are not subject to the CC&R’s.
The Court overrules Objection no. 5 (Request for Judicial Notice, ¶ 3 and Exhibit 3 to Request for Judicial Notice). While it is unclear how the Final Subdivision Public Report is relevant to this MSJ (neither paragraph 3 of the Request for Judicial Notice, nor Exhibit 3 to the Request for Judicial Notice, is referenced in the Separate Statement), it is also true Plaintiff should only raise “objections to items of evidence that are legitimately in dispute and pertinent to the disposition of the summary judgment motion.” (Reid v. Google, Inc. (2010) 50 Cal.4th 512, 532-533; accord, Cohen v. Kabbalah Centre Internat., Inc. (2019) 35 Cal.App.5th 13, 20-21.)
D. The Court Denies the MSJ
When interpreting a contract, a court seeks to ascertain the mutual intent of the parties solely from the written contract so long as possible. (Civ. Code, § 1638.) The court considers the contract as a whole and interprets the language in context, rather than in isolation. (Civ. Code, § 1641.) And where the language is clear and explicit, and does not involve an absurdity, the plain meaning governs. (Civ. Code, § 1638.) In this same vein, the court “should avoid an interpretation which will make the contract unusual, extraordinary, harsh, unjust or inequitable [citations], or which would result in an absurdity ....” [Citation.]
But, “ ‘Where the meaning of the words used in a contract is disputed, the trial court must provisionally receive any proffered extrinsic evidence which is relevant to show whether the contract is reasonably susceptible of a particular meaning. [Citations.] Indeed, it is reversible error for a trial court to refuse to consider such extrinsic evidence on the basis of the trial court’s own conclusion that the language of the contract appears to be clear and unambiguous on its face. Even if a contract appears unambiguous on its face, a latent ambiguity may be exposed by extrinsic evidence which reveals more than one possible meaning to which the language of the contract is yet reasonably susceptible. [Citations.]’ ” [Citation.]
(West Pueblo Partners, LLC v. Stone Brewing Co., LLC (2023) 90 Cal.App.5th 1179, 1185-1186.)
When a document can be interpreted in two equally plausible ways, parol evidence is admissible to aid in interpreting the agreement, thereby presenting a question of fact which precludes summary judgment if the evidence is contradictory. (Wolf v. Superior Court (2004) 114 Cal.App.4th 1343, 1351; Wolf v. Superior Court (2008) 162 Cal.App.4th 1107, 1126-1127 [when there is a conflict in the extrinsic evidence, the factual conflict is to be resolved by a jury]; accord, Brown v. Goldstein (2019) 34 Cal.App.5th 418, 433.)
“ ‘[I]f a contract is capable of two constructions, the court must choose that interpretation which will make the contract legally binding if it can be so construed without violating the intentions of the parties.’ [Citation.]” (Moreland Development Co. v. Gladstone Holmes, Inc. (1982) 135 Cal.App.3d 973, 978.)
Here, the parties disagree as to the interpretation of the terms of the CC&R’s, and particularly as to Section 15.6.
Section 15.6 states,
Phase 5. The City of Yorba Linda, as a condition of approval of this planned residential development, has required that Lot 6 and Lot 7 of Tract No. 15501 be included as part of the Association and subject to this Declaration. Lot 6 and Lot 7 are included on Exhibit “A” “Annexable Property” as part of Phase 5. Lot 6 and Lot 7 are owned by Albert G. Murrietta and Helen Murrietta, Co-Trustees of the Albert and Helen Murrietta Family Trust established under Declaration of Trust dated July 18, 2022 (hereinafter referred to as “Owner of Lots 6/7”). The Owner of Lots 6/7, by their signature on this Declaration, hereby consent to the terms of this Declaration, including this Section 15.6, and further agree to record a Declaration of Annexation which subjects Lot 6 and Lot 7 of Tract No. 15501 to this Declaration, prior to the Close to Escrow of a Lot to a retail purchaser within Phase 5. Declarant and Association shall not prevent the Annexable Property from becoming part of the Association.
(Exhibit E to Declaration of Valentine Sarad in Opposition to MSJ.)
Defendants’ position is that, until their Lots 6 and 7 are sold to a retail purchaser, they are not subject to the CC&R’s. Plaintiff’s interpretation of section 15.6 is that Defendants agreed to be bound by the CC&R’s the moment they signed it.
Both parties have presented extrinsic evidence, which the Court has provisionally received, which evinces two equally plausible interpretations of the CC&R’s. (Wolf, supra, 114 Cal.App.4th at p. 1351.)
According to Plaintiff, section 15.6 included two distinct agreements. The first agreement is that Defendants agreed Lots 6 and 7 were subject to the CC&R’s from the moment Defendants signed the CC&R’s on March 18, 2004, even though the two lots had not been annexed into the Association. This meant, while Defendants may not have been members of the Association, Lots 6 and 7 were still subject to the CC&R’s. (Exhibits A-G; Sarad Declaration.)
The second, and separate, agreement is that Defendants agreed to record a Declaration of Annexation prior to the close of escrow of either Lot 6 or 7 to a retail purchaser. This would occur during Phase 5 of the planned residential development. At that point, Lots 6 and 7, including their new owners, would become members of the Association. (Exhibit E; Sarad Declaration.)
However, in Exhibit B of the Murrietta Declaration, Defendant Albert G. Murrietta was advised, while he had agreed to the terms of the CC&R’s, i.e., he agreed to the CC&R’s language, he had not agreed to be bound by them. (Exhibit B to Murrietta Declaration.)
This provisionally received evidence presents the conflict in evidence, which presents a factual conflict that precludes summary judgment. (Wolf, supra, 114 Cal.App.4th at p. 1351; accord, Brown, supra, 34 Cal.App.5th at p. 433; see also Wolf, supra, 114 Cal.App.4th at p. 1355 [trial court erred in finding extrinsic evidence did not reveal an ambiguity in the parties’ contract]; see Wolf, supra, 162 Cal.App.4th at p. 1127 [if there is a conflict in the extrinsic evidence, the factual conflict is to be resolved by the jury] .)
The Court denies Defendants’ MSJ, finding there are triable issues of material fact as to the interpretation of section 15.6 of the CC&R’s. (Exhibits A-G to Sarad Declaration and Exhibit B to Murrietta Declaration.) Thus, it finds there are triable issues of material fact as to Material Fact nos. 3-5, 8-10, 13-15, and 18-20.
Plaintiff to give notice.