Judge: John C. Gastelum, Case: 21-01200462, Date: 2022-09-27 Tentative Ruling
Motion for Summary Judgment and/or SAI
Tentative Ruling: Defendant Belcourt Hill Homeowners Association (HOA) seeks an order granting summary adjudication as to the 1st cause of action and punitive damages claim relating to the 2nd cause of action of Plaintiff’s Complaint.
MOTION IS DENIED IN ITS ENTIRETY.
In the 1st COA (Breach of Governing Documents), Plaintiff pleads:
37. The sewer pipe is solely the responsibility of the HOA to maintain, pursuant to Section 1.6 of the CC&Rs.
38. When Plaintiff brought the sewer pipe issue to the attention of Defendant’s agent, Cardinal, Cardinal directed Plaintiff to remediate the sewer pipe issue herself, and then submit any resulting invoices to the HOA through its agent Cardinal for reimbursement.
39. Plaintiff remediated the sewer pipe issue by hiring a competent third party. Plaintiff paid third party in full for the invoices it submitted to Plaintiff. Plaintiff then forwarded the invoices to the HOA through its agent Cardinal for reimbursement as directed by Cardinal.
40. Defendants thereafter refused to pay any portion of the invoices in breach of their obligations under the Governing Documents.
(Emphasis added.)
While Defendant focuses on the breach of the governing documents as the “failure to reimburse”, Plaintiff suggests in the opposition the breach of the documents is in failing to maintain the pipe itself and delegating the issue to Plaintiff in the first place. Indeed, the section of the CC&Rs mentioned in the cause of action itself is in reference to the sewer pipe being the sole responsibility of the HOA to maintain.
As Defendant fails to address the allegation of Complaint¶37, it does not appear it has sustained its initial, substantive burden in that it only analyzes a portion of the claim relating to failure to reimburse.
Furthermore, the arguments regarding the applicability of the business judgment rule appear to miss the issue as well. Defendant argues Defendant's "discretionary economic decision" to deny Plaintiff reimbursement of her unapproved preventative sewer line excavation and replacement was a good faith decision, made for the benefit of the association and its members. However, the issue appears to be whether the business judgment rule applies to the decision to not maintain the sewer pipe, and delegate that duty, in the first place, was a good faith decision, etc.
Furthermore, arguably “inaction” is not business judgment. (Palm Springs Villas II Homeowners Assn., Inc. v. Parth (2016) 248 Cal.App.4th 268, 280 [204 Cal.Rptr.3d 507, 517–518], as modified on denial of reh'g (July 14, 2016).)
Plaintiff’s additional facts provide sufficient evidence of failure to act so as to create a triable issue of material fact. (See AMF Nos. 41-50. See, Decl. of Dewitt¶11.)
As such, motion for adjudication as to the 1st COA is denied.
In the 2nd COA (promissory estoppel), Plaintiff seeks punitive damages. Defendant does not seek adjudication as to the cause of action, but as to punitive damages sought in connection therewith. In the 2nd COA, Plaintiff pleads:
49. Defendants have engaged in harassing and intimidating tactics against Plaintiff by grilling her with questions regarding the sewer pipe and forcing her to seek the promised reimbursement by hiring an attorney to engage in this litigation against her own neighbors, at great inconvenience, cost, and discomfort to Plaintiff.
51. The HOA, including its agents, has acted with such a reckless and callous disregard for Plaintiff’s rights and interest, and has so failed in its own duties under the Governing Documents, that the imposition of punitive damages is warranted. Defendants’ actions were willful and reckless. Accordingly, Plaintiff is entitled to punitive damages, according to proof.
Pursuant to Code of Civil Procedure section 437c(f)(1) a “party may move for summary adjudication as to… one or more claims for damages….”
Defendant argues that questioning Plaintiff at the HOA meeting does not sufficiently amount of egregious conduct sufficient to warrant the imposition of punitive damages. Defendant also sets forth in UMF No. 40 that, “Plaintiff has no evidence that the HOA acted with any oppression, fraud or malice.”
However, Plaintiff disputes that fact and submits her declaration which suggests she felt bullied and harassed at the zoom meeting, which she left in tears. (See Dewitt Decl.¶14.) Her now husband also declares that the way the board treated her was totally inappropriate. (Decl. of Price¶5.)
Curiously however, neither side brings up the alleged facts of the promissory estoppel claim, i.e., “Plaintiff was directed by the HOA, through its authorized agent, to have the backed-up sewer pipe remediated at her own cost, and then to submit any resulting invoices to the HOA for reimbursement.” (Complaint ¶45.) That defendant’s agent told Plaintiff what to do, and thereafter the HOA proceeded to bully and harass Plaintiff over actions their agent told her to take, may be perceived by a jury as sufficient facts to warrant punitive damages.
Furthermore, that instead of paying at least half of the bill (Declaration Dewitt¶20) for their agent’s alleged mistake, Defendant chose to proceed with litigation, could be viewed as sufficiently malicious or oppressive for a jury to determine punitive damages are appropriate.
Motion is denied as to Issue 2.
OBJECTIONS:
ROA 119 (Plaintiffs Objections to Declarations of Spadoni/Woodward:
Not material to the Court’s ruling.
ROA 128 (Defendants Objections to Declaration of Amanda Dewitt):
1. Not material
2. Sustain
3. Sustain
4. Not material
5. Overrule
6. Overrule
7. Sustain
8. Overrule
9. Overrule
10. Overrule
11. Overrule
12. Overrule
13. Overrule
14. Sustain
15. Overrule
16. Not material
17. Not material
ROA 127 (Plaintiffs Objections to Defendants Reply)
1. Overrule
2. Sustain
3. Overrule
4. Overrule
As to ROA 130 (Plaintiffs Objections to Defendants Reply), the Court did not consider the response to plaintiffs’ separate statement or any new arguments in the reply— consequently, any rulings on the “objection” to those two documents and/or arguments contained thereto is unnecessary.
Plaintiff to give notice.