California Court of Appeals, Fourth District, First Division
TRILOGY AT GLEN IVY MAINTENANCE ASSOCIATION et al., Plaintiffs and Respondents,
SHEA HOMES, INC. et al., Defendants and Appellants.
APPEAL from an order of the Superior Court of Riverside County, No. RIC10025131 Michael C. Perantoni, Judge.
[Copyrighted Material Omitted]
Connor, Fletcher & Hedenkamp, Matthew J. Fletcher and Douglas A. Hedenkamp for Defendants and Appellants.
Epsten, Grinnell & Howell, Rian W. Jones and William S. Budd for Plaintiffs and Respondents.
Plaintiff Trilogy at Glen Ivy Maintenance Association (Association) and various homeowners (together plaintiffs) filed this action against defendant Shea Homes, Inc., and others (together Shea) alleging, essentially, that Shea improperly diverted revenues from a contract that should have been paid to Association. After Shea sought and obtained judgment on the pleadings, plaintiffs filed an amended complaint, and Shea responded by moving to dismiss the amended complaint pursuant to Code of Civil Procedure section 425.16, commonly referred to as the anti-SLAPP (strategic lawsuit against public participation) statute. (Equilon Enterprises v. Consumer Cause, Inc. (2002) 29 Cal.4th 53, 57 [124 Cal.Rptr.2d 507, 52 P.3d 685].) The trial court denied the motion and this appeal by Shea followed.
FACTUAL AND PROCEDURAL BACKGROUND
A. Relevant Facts
Shea developed and built a master planned community (the Trilogy Project)
in Corona, California. Association is the homeowners association that maintains, manages and governs the Trilogy Project.
In August 2001, when Shea was still the sole owner of the land (the Property) on which the Trilogy Project was ultimately built, Shea entered into a contract (the Contract) with AT&T Broadband (AT&T) to facilitate the provision of broadband communication services to the residences and businesses within the Trilogy Project. Under the Contract, Shea agreed to construct (and to grant AT&T a license to use) a conduit/duct system on the property to install and maintain AT&T's cables and communications equipment, and granted AT&T an easement over the Property to install and maintain the equipment. In consideration for these and other covenants by Shea, AT&T agreed to pay Shea the amounts specified in the Contract.
The recorded covenants, conditions and restrictions (CC&R's) governing the Trilogy Project provided that the Board of Directors for Association (the Board) had the power to enter into exclusive telecommunications contracts. Shea and its representatives served on and controlled the Board at the time the Contract was entered into between Shea and AT&T, and Shea remained in control of the Board until mid-2006. During this period, Shea and its representatives owed fiduciary obligations to Association.
Shea did not disclose, and plaintiffs did not know of, the Contract or the payments Shea was to receive under the Contract until the spring of 2010. At that time, Association's manager opened a letter addressed to "Trilogy at Glen Ivy." The envelope contained a check from Time Warner Cable (AT&T's successor in interest under the contract) in the amount of $175, 000 made payable to Shea, and a cover letter that stated the check was for the payment owed under the Contract. After receiving two more checks for amounts due under the Contract, both of which were also made payable to Shea, Association contacted Time Warner Cable and asked that the checks be reissued in Association's name because it was Shea's transferee. Time Warner Cable ultimately placed stop payment orders on the checks and declined to make further payments until Shea and Association resolved the conflict over who was entitled to the payments. Association corresponded with Shea and asserted it was entitled to the payments. Shea did not respond and Association filed the present action.
B. Procedural ...