JR Enterprises v. >Lawrence>

























Filed 1/9/13 JR Enterprises
v. Lawrence CA4/3









NOT TO BE PUBLISHED IN OFFICIAL REPORTS



California Rules of Court, rule 8.1115(a), prohibits
courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for
publication or ordered published for purposes of rule 8.1115>.





IN
THE COURT OF APPEAL OF THE STATE OF CALIFORNIA



FOURTH
APPELLATE DISTRICT



DIVISION
THREE




>

JR ENTERPRISES, L.P., Plaintiff, Cross-defendant and Appellant, v. MICHAEL LAWRENCE et al., Defendants, Cross-complainants and Respondents.

G046180 (Super. Ct. No. 30-2011-00454420) O P I N I O N

Appeal
from an order of the Superior Court of href="http://www.adrservices.org/neutrals/frederick-mandabach.php">Orange
County, Tam Nomoto Schumann, Judge. Affirmed.

Horvitz
& Levy, Jeremy B. Rosen, Steven S. Fleischman; Barnes, Crosby, Fitzgerald
& Zeman, Larry S. Zeman and Eric P. Francisconi for Plaintiff,
Cross-defendant and Apellant.

Julander,
Brown & Bollard, William C. Bollard, Richard L. Brown and Dustin M. Monroe
for Defendants, Cross-complainants and Respondents.



* * *

Plaintiff
and cross-defendant JR Enterprises, L.P. (tenant) appeals from the denial of
its special motion to strike under
the anti-SLAPP statute (Code Civ. Proc., § 425.16; all further statutory
references are to this code unless otherwise stated) the breach of contract
claim in the cross-complaint filed by defendants and cross-complainants Michael
Lawrence and Victoria Lawrence (landords).
Tenant contends the court erred in sustaining landlords’ evidentiary
objections and finding tenant had not met its burden under the first prong of
the anti-SLAPP statute to demonstrate the breach of contract cause of action
was based on protected activity. Finding no error, we affirm.



FACTS



Disputes
over the interpretation of a long-term ground lease for a 14-acre parcel of
real property resulted in landords suing tenant in 2008 (underlying
action). In January 2011, the court
entered judgment in tenant’s favor and an amended judgment filed that March
awarded tenant almost $130,000.
Landlords appealed. (>Lawrence v. JR Enterprises, Inc., L.P.
(G044999, app. pending) and Lawrence> v. JR Enterprises, L.P. (G045163, app. pending)).

Before
judgment was entered, landlords notified tenant in November 2010 payment was
owed for utilities and other expenses for a one-acre portion of the
property. Landlords followed up with a
second letter on January 17, 2011, and demanded
$30,705.99 be placed into their attorney’s client trust fund. Three days later, an entity called Plan 53,
LLC served a notice of judgment lien on tenant, claiming it had a contractual
lien against the recovery of any fees earned by landlords’ attorney and advised
“any payment in connection with this case . . . must
include Plan 53, LLC as a payee.”

Tenant
sent a letter to landlords explaining why it did not owe the $30,705.99, and
also one to Plan 53 LLC asking whether the $30,705.99 demanded by landlords was
subject to Plan 53 LLC’s lien. When
tenant did not receive responses, it filed a complaint for interpleader,
declaratory relief, and unjust enrichment, denying “the $30,705.99 is owed to
[landlords], but [claiming] if it is owed [tenant] is unable to determine to
whom those funds should be paid.”

In
response, landlords filed a cross-complaint, asserting, inter alia, a first
cause of action for breach of contract and request for lease termination. They also served a notice of termination of
the lease. Tenant in turn filed its own
cross-complaint for declaratory relief and an anti-SLAPP motion directed to the
first cause of action for breach of contract.


In
support of its anti-SLAPP motion, tenant sought to introduce the notice of
termination by attaching it to the declaration of counsel, who asserted it was
a “true and correct copy of the [one] signed by [landlords] that was
subsequently mailed to [tenant] . . . .” Tenant argued the motion should be granted
because the notice of termination said tenant’s “willful, grossly negligent or
fraudulent breach of duty is proven in part by [its] bad faith filing of an
improper [i]nterpleader action” (italics omitted) and the filing of the
interpleader action is protected activity under the anti-SLAPP statute.

Landlords
then filed a cross-complaint to tenant’s cross-complaint for declaratory
relief. A month later, landlords
dismissed its original cross-complaint with prejudice before the hearing on the
anti-SLAPP motion.

The
trial court sustained three of landlords’ four evidentiary objections to the
notice of termination. It thereafter
denied the anti-SLAPP motion, finding tenant had not satisfied its burden under
the first prong of the anti-SLAPP statute.










DISCUSSION



>1. Introduction

Under
section 425.16, subdivision (b)(1), a cause of action against a person arising
from an act in furtherance of a constitutionally protected right of free speech
or petition may be stricken unless the plaintiff establishes the probability of
prevailing on the claim. The statute first
requires a moving party to demonstrate “‘the challenged cause of action is one
arising from protected activity.’” (>Jarrow Formulas, Inc. v. LaMarche (2003)
31 Cal.4th 728, 733.) If that is done,
the burden shifts to the party defending against the motion to show a
probability of prevailing on its claim.
(Ibid.) This second step need not be reached if the
moving party fails to establish the complaint arose out of protected
activity. (See Wang v. Wal–Mart Real Estate Business Trust (2007) 153 Cal.App.4th
790, 801.)

We
review the court’s ruling de novo, considering “‘“the pleadings, and supporting
and opposing affidavits . . . upon which the liability or
defense is based.” [Citation.] However, we neither “weigh credibility [nor]
compare the weight of the evidence.
Rather, . . . [we] accept as true the evidence
favorable to the plaintiff [citation] and evaluate the defendant’s evidence
only to determine if it has defeated that submitted by the plaintiff as a
matter of law.” [Citation.]’ [Citation.]”
(Flatley v. Mauro (2006) 39
Cal.4th 299, 325-326.)



>2. Mootness

Tenant
contends landlords’ dismissal of its first cross-complaint with prejudice did
not moot its anti-SLAPP motion. We
agree. Tenant was “entitled to have the
merits of [its anti-SLAPP] motion heard as a predicate to a determination of
[its] motion for attorney[] fees and costs under subdivision (c)
of . . . section” 425.16.
(Liu v Moore (1999) 69
Cal.App.4th 745, 751.) Landlords do not
address this issue, implicitly conceding it.
(Sehulster Tunnels/Pre-Con v.
Traylor Brothers, Inc./Obayashi Corp. (2003) 111 Cal.App.4th 1328, 1345,
fn. 16.)



>3. Evidentiary Objections

Tenant
argues the court abused its discretion in sustaining landlords’ evidentiary
objections to the notice of termination on the grounds it was hearsay, not
lodged “in an original form as required,” and not requested to be judicially
noticed under Evidence Code section 452.
We conclude no abuse of discretion occurred in excluding the document
because it was not properly authenticated.


A
writing must be authenticated before it or “secondary evidence of its content
may be received in evidence.” (Evid.
Code, § 1401.) The declaration of
tenant’s attorney that the document was a “true and correct copy of the [one] signed
by [landlords] that was subsequently mailed to [tenant]” failed to show he had
personal knowledge to authenticate the document. (Evid. Code, § 1413.) Tenant thus did not carry its burden of
establishing the authenticity of the document.
(Evid. Code, § 403, subd. (a)(3).)

Tenant
contends landlords’ failure to specifically object on the ground the document
was not property authenticated precludes our consideration of it on
appeal. We disagree. In reviewing a “trial court’s evidentiary
ruling for abuse of discretion [citation] . . . we review
‘the ruling, not the rationale.’
[Citation.]” (>Park v. First American Title Co. (2011)
201 Cal.App.4th 1418, 1427.) This
applies to the exclusion of evidence.
“If evidence is excluded on an improper objection but the evidence
excluded is subject to objection on a different ground, it does not matter that
the reason advanced by counsel or relied upon by the court was wrong. [Citations.]
If the exclusion is proper upon any theory of law applicable to the instant
case, the exclusion must be sustained regardless of the particular
considerations which may have motivated the trial court to its decision. [Citations.]”
(Philip Chang & Sons
Associates v. La Casa Novato (1986) 177 Cal.App.3d 159, 173.)

The
authorities cited by tenant for its claim landlords waived any objection not
specifically made are inapposite because none address the issue of evidence
properly excluded on a legal theory not considered by the court. Rather, they either pertain to the erroneous
admission of evidence (see Evid. Code, § 353; People v. Boyette (2002) 29 Cal.4th 381, 424; Broden v. Marin Humane Society (1999) 70 Cal.App.4th 1212,
1226-1227 & fn. 3; People v. Mattson
(1990) 50 Cal.3d 826, 854, superseded by statute on other grounds as stated in >People v. Bolin (1998) 18 Cal.4th 297,
315, fn. 2; People v. Dorsey (1974)
43 Cal.App.3d 953) or involve a claim evidence was erroneously excluded on a
ground not previously raised (People v.
Valdez (2004) 32 Cal.4th 73, 108; Interinsurance
Exchange v. Velji (1975) 44 Cal.App.3d 310, 317-318).

Even if
the trial court had abused its discretion in excluding the document, that would
not affect the outcome of this case because the gravamen of the case remains
tenant’s failure to pay, as we shall explain below.



>4. Protected Activity

To
satisfy its burden under the first prong of section 425.16, tenant had to make
“the threshold showing” the breach of contract cause of action cross-complaint
“arises from protected activity.” (>Rusheen v. Cohen (2006) 37 Cal.4th 1048,
1056.) “[T]he statutory phrase ‘cause of
action . . . arising from’ means simply that the
defendant’s act underlying the plaintiff’s cause of action must >itself have been an act in furtherance
of the right of petition or free speech.
[Citation.] In the anti-SLAPP
context, the critical point is whether the plaintiff’s cause of action itself
was based on an act in furtherance of
the defendant’s right of petition or free speech. [Citation.]”
(City of Cotati v. Cashman (2002)
29 Cal.4th 69, 78.)

Landlords’
first cause of action alleged tenant breached the lease by failing “to pay all
utilities and other obligations” despite several demands for payment. “As a result, [they] served in accordance
with the lease a notice of termination and a notice of forfeiture and has
demanded that [tenant] immediately vacate the premises and surrender[] same to
[landlords]. . . . [Tenant has] failed to comply with the
lease provisions, . . . [has] not surrendered the premises
and . . . [has] continued to fail to pay the amount of the
utility obligations owed to [landlords]. . . . Said breach
of [tenant’s] duty is willful, fraudulent or grossly negligent and it therefore
deprives [it] from any ability to redeem [its] obligations and restore [its]
lease rights under Civil Code section 3275.”
These allegations show the cause of action was based on tenant’s failure
to pay the utility and other expenses, not its filing of the interpleader
action.

Tenant
notes landlords’ prayer for relief requested a “judicial order that [tenant]
breached the lease agreement and all rights there[]under are terminated and
forfeited based on a willful, fraudulent or grossly negligent breach of duty
which deprived [tenant] of redemption rights under Civil Code [s]ection
3275.” According to tenant, a mere
breach of contract or an honest dispute over the amount owed is insufficient
under Civil Code section 3275, and “[t]he only
basis alleged in the cause of action justifying the extraordinary relief of
lease termination under [that statute] is the [n]otice of [t]ermination, which
alleges that [tenant] engaged in ‘bad faith’ by filing the interpleader
complaint.” On the contrary, landlords
pled tenant repeatedly failed to pay despite their several notices to do so
including the notice of termination, which could reasonably give rise to an
inference of willful failure to comply with the terms of the lease. (See Fowler
v. Vaughan (1948) 86 Cal.App.2d 772, 777 [“no question” the defendant’s
failure to pay was willful under Civil Code section 3275 where “[i]nstead of
merely failing to pay [a defendant] refused to pay and consistently maintained
that he was under no obligation to pay, that he had full ownership of the
property, and that the [plaintiff] had no rights whatever”]; >Taylor v. United States. Fidelity &
Guaranty Co. (1927) 86 Cal.App. 382, 390 [affirming willfulness finding
under Civil Code section 3275 where “breach . . . was
spontaneous and voluntary”].)

Further,
the relief sought in a complaint is not determinative of whether the anti-SLAPP
statute applies to a particular cause of action. (See Marlin
v. Aimco Venezia, LLC (2007) 154 Cal.App.4th 154, 162 [noting an anti-SLAPP
motion is directed at a cause of action, not “the remedy sought,” and rejecting
the defendants’ argument that the plaintiffs’ prayer for injunctive relief
triggered application of the anti-SLAPP statute] (Marlin).) Tenant
distinguishes Marlin on the basis
that here it “is not seeking to strike the prayer for relief.” But neither were the defendants in >Marlin.
Rather, the Marlin defendants
sought to specially strike the plaintiffs’ entire complaint based on the prayer
for relief. (Marlin, supra, 154
Cal.App.4th at p. 158.)

Tenant
also claims Marlin is inapposite
because landlords were seeking to enforce the primary right of terminating the
long-term lease. But the allegations of
the cross-complaint, as opposed to the prayer for relief, do not bear that
out. Rather, they demonstrate landlords
were attempting to enforce the primary right of being paid under the
lease. Nor do the cases cited by tenant
holding that civil petitions for injunctive relief are subject to section
425.16 persuade us otherwise because the anti-SLAPP motion in those cases did
not rely on the remedy being sought in the prayer for relief. (See (City
of Los Angeles v. Animal Defense League (2006) 135 Cal.App.4th 606, 617; >Thomas v. Quintero (2005) 126
Cal.App.4th 635, 646-652.)

Tenant
maintains landlords’ “cross- complaint specifically refers to the [n]otice of
[t]ermination.” But it only did so in
the context of alleging that such notice was sent “[a]s a result” of tenant’s
refusal to pay despite several notices.
The fact the cross-complaint did not claim entitlement to termination of
the lease until after the allegation the notice of termination was sent does
not, as tenant asserts, show the cause of action was “based on” (City of Cotati v.
Cashman, supra, 29 Cal.4th at p.
78) the filing of the interpleader action.
Notably, the allegation tenant’s breach of duty was “willful, fraudulent
or grossly negligent” came after the paragraph alleging it “continued to fail
to pay” despite the notice of termination.

Moreover,
we have already concluded the trial court did not abuse its discretion in
sustaining landlords’ objections to the notice of termination. But even if error occurred, that would not
change the result. “[I]t is the >principal thrust or gravamen of the plaintiff’s cause of action that determines whether
the anti-SLAPP statute applies [citation], and when the allegations referring
to arguably protected activity are only incidental to a cause of action based
essentially on nonprotected activity, collateral allusions to protected
activity should not subject the cause of action to the anti-SLAPP statute.” (Martinez
v. Metabolife Intern., Inc. (2003) 113 Cal.App.4th 181, 188.)

The
notice of termination states: “>NOTICE IS HEREBY GIVEN THAT no right to
redeem by [tenant] exists pursuant to Civil Code section 3275, >based on [tenant’s] pre-meditated
willful, grossly negligent or fraudulent failure
to pay the subject $30,755.99. This
willful, grossly negligent or fraudulent breach of duty is proven in part by their bad faith filing of an improper
[i]nterpleader action . . . wherein they admit receipt of
the [n]otice of the outstanding amount of the $30,755.99, and backup records,
yet they willfully refuse to pay [owner].”
(Italics added.) The plain
language of the document shows landlords were seeking to terminate the lease
“based on” tenant’s “failure to pay,” not because tenant had filed an
interpleader complaint. The fact owner
would attempt to prove “in part” tenant’s bad faith with evidence of the
interpleader suit does not show the first cause of action was “based on”
protected activity. Rather, such language
was merely incidental and collateral to the unprotected activity of tenant’s
alleged failure to pay.

We also
reject tenant’s argument “it was only after
the filing of the interpleader complaint that landlords began asserting a claim
for lease termination under [Evidence Code] section
3275 . . . .” Tenant
cites the letters it and landlords sent, and the fact landlords did not serve
the notice of termination or file their cross-complaint until about two months
following tenant’s filing of the interpleader complaint. “‘[T]he mere fact that an action was filed
after protected activity took place does not mean the action arose from that
activity for the purposes of the anti-SLAPP statute. [Citation.]
Moreover, that a cause of action arguably may have been “triggered” by
protected activity does not entail that it is one arising from such. [Citation.]’”
(Episcopal Church Cases (2009)
45 Cal.4th 467, 477.)

Nor has
tenant shown the cause of action is a “mixed” one. “When a cross-complainant presents a mixed
cause of action that involves protected and non-protected
activities, . . . the question presented is ‘whether the
gravamen of the cause of action targets protected activity. [Citation.]
If liability is not based on protected activity, the cause of action
does not target the protected activity and is therefore not subject to the
SLAPP statute. [Citations.]’ [Citation.]
Stated differently, the question is whether the protected activity is
merely an incidental part of the cause of action. [Citation.]”
(City of Colton v. Singletary
(2012) 206 Cal.App.4th 751, 767.) The
problem here is tenant has not established the subject cause of action is based
on any protected conduct.





DISPOSITION



The
order is affirmed. Respondents shall
recover their costs on appeal.









RYLAARSDAM,
ACTING P. J.



WE CONCUR:







ARONSON, J.







FYBEL, J.