Hudack v. Siggard
Filed 11/6/13 Hudack v. Siggard CA4/2
NOT TO BE PUBLISHED IN OFFICIAL REPORTS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opinion has not been certified for publication or ordered published for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
FOURTH APPELLATE DISTRICT
DIVISION TWO
MARIANNE S. HUDACK et al.,
Plaintiffs,
Cross-defendants and Appellants,
v.
WAYNE SIGGARD,
Defendant,
Cross-complainant and Respondent;
MONTELEONE CONTRACTORS, INC. et al.,
Defendants
and Respondents.
E052779
(Super.Ct.No. RIC450529)
MARIANNE S. HUDACK et al.,
Plaintiffs
and Appellants,
v.
WAYNE SIGGARD et al.,
Defendants
and Respondents.
E053129
[NO
CHANGE IN JUDGMENT]
The
petition for rehearing is denied. The
opinion filed in this matter on October
17, 2013, is modified as
follows:
In
the first paragraph on page 11 of the opinion, the second complete sentence reads: “On approximately March 25, Siggard submitted
his grading permit and maps of his grading plans to the Association.â€
The
sentence is modified to read as follows:
“On
approximately March 25, Siggard submitted his agricultural exemption and maps of his grading
plans to the Association.â€
Except for this modification,
the opinion remains unchanged. The
modification does not affect a change in the judgment.
NOT
TO BE PUBLISHED IN OFFICIAL REPORTS
MILLER
J.
We concur:
RICHLI
Acting P. J.
CODRINGTON
J.
Filed
10/17/13 (unmodified version)
NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for
publication or ordered published for purposes of rule 8.1115.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
FOURTH APPELLATE DISTRICT
DIVISION TWO
MARIANNE S. HUDACK et al.,
Plaintiffs,
Cross-defendants and Appellants,
v.
WAYNE SIGGARD,
Defendant,
Cross-complainant and Respondent;
MONTELEONE CONTRACTORS, INC. et al.,
Defendants
and Respondents.
E052779
(Super.Ct.No.
RIC450529)
MARIANNE S. HUDACK et al.,
Plaintiffs
and Appellants,
v.
WAYNE SIGGARD et al.,
Defendants
and Respondents.
E053129
OPINION
APPEAL
from the Superior Court
of Riverside County. Dallas Holmes (retired judge of the Riverside
Super. Ct. assigned by the Chief
Justice pursuant to art. VI, § 6 of the Cal.
Const.), Thomas H. Cahraman and Bernard Schwartz, Judges. Affirmed.
Buchalter
Nemer, Robert M. Dato; Circuit, McKellogg, Kinney & Ross and Robert Keith
McKellogg for Plaintiffs, Cross-defendants and Appellants Marianne S. Hudack,
Larry J. Hudack and Larry J. and Marianne S. Hudack Trust UTD July 3, 1997.
The
Rossell Law Firm, Craig N. Rossell; The Ehrlich Law Firm and Jeffrey Isaac
Ehrlich for Defendant, Cross-complainant and Respondent Wayne Siggard.
The
Rossell Law Firm and Craig N. Rossell for Defendants and Respondents Monteleone
Contractors, Inc. and Ryan Monteleone.
Pamela
J. Walls, County Counsel and Lisa A. Traczyk, Deputy County Counsel for
Defendant and Respondent County of Riverside.
Kramer,
Deboer, Endelicato & Keane, Jeffrey S. Kramer, Sandra Calin and Elizabeth
D. Beckman for Defendant and Respondent La Cresta Property Owners Association.
This
case arises from a dispute between neighbors.
Wayne Siggard (Siggard) caused land he owned to be graded. Siggard’s neighbors, Marianne Hudack
(Marianne) and Larry Hudack (Larry)
name="_ftnref1" title="">
(collectively “the Hudacksâ€), found the grading to be problematic. In a fifth amended complaint, the Hudacks
sued (1) Siggard; (2) Monteleone Contractors, Inc. (Contractor); (3)
Ryan Monteleone, an individual doing business as Monteleone Excavating
(Monteleone); (4) La Cresta Property Owners Association (the Association); (5)
Sergio Ochoa; and (6) Laura Ochoa. The
causes of action concerned (1) a violation of the California Environmental
Quality Act (CEQA); (2) trespass; (3) encroachment; (4) nuisance per se; (5)
private nuisance; (6) negligence; (7) breach of fiduciary duty; (8) negligent
misrepresentation; (9) fraud and deceit; (10) a request for declaratory relief;
(11) a request for injunctive relief; and (12) a request for cancellation of
written instruments.
Siggard
filed a cross-complaint against (1) Marianne; (2) Larry; (3) the Larry J. and
Marianne S. Hudack Trust (the Trust); (4) the County of Riverside (the County);
and (5) the County of Riverside Planning Department. The cross-complaint included causes of action
for (1) a CEQA violation; (2) trespass; (3) encroachment; (4) nuisance;
(5) civil conspiracy to defraud; (6) defamation, slander, and libel; (7) interference
with a prospective economic advantage; (8) slander of title; and (9)
intentional infliction of emotional distress.
In
response to the cross-complaint, the Hudacks filed an anti-SLAPP motion. (Code Civ. Proc., § 425.16.) Some of Siggard’s causes of actions were
stricken as a result of the trial court’s anti-SLAPP ruling. Ultimately, a jury found against the Hudacks
on their causes of action. The jury
found in favor of Siggard on his private nuisance claim against the
Hudacks. The jury awarded Siggard
$437,200 in economic damages and $167,500 in punitive damages.
The
Hudacks raise eight issues on appeal.
The Hudacks’ first issue concerns Siggard’s lawsuit against the
Hudacks. The Hudacks contend substantial
evidence does not support the jury’s private nuisance verdict in favor of
Siggard. The second and third
contentions concern the Hudacks’ lawsuit against Siggard and Contractor. The second contention is the judgment on the
Hudacks’ private nuisance claims against Siggard and Contractor should be
reversed because the jury was improperly permitted to consider whether
Siggard’s grading violated a County ordinance.
The third contention is the trial court erred by denying the Hudacks’
motion for new trial because there was “a fatal inconsistency†between the jury
instructions and special verdict form concerning private nuisance. The fourth issue on appeal concerns a trial
court writ of mandate the Hudacks sought against the County. The Hudacks assert the trial court erred by
concluding the County had complied with the writ.
The
Hudacks’ fifth through eighth causes of action concern their lawsuit against
the Association. The Hudacks’ fifth
contention is the trial court erred by granting the Association’s demurrer on
the breach of contract cause of action.
The sixth contention is the trial court erred by granting the
Association’s demurrer on the breach of fiduciary duty cause of action. The seventh contention is the trial court
prejudicially misinterpreted the trial court’s prior summary adjudication
ruling. The eighth contention is the
jury instruction concerning the Association’s duties to property owners was
misleading. We affirm the judgments.
COUNTY
In
this section of the opinion, we address the issues pertaining to the Hudacks,
Siggard, Contractor, and the County.
A. Siggard and Hudack Property Purchases
Rancho
La Cresta (La Cresta) is a residential community located in an unincorporated
area of Riverside County near Murrieta and Temecula. La Cresta has a minimum parcel size of five
acres, and consists of 59 parcels. In
2000, La Cresta consisted of a large amount of open space with trees, valleys,
and seasonal streams; approximately 60 percent of the home sites in the
community were vacant, i.e., they had not been built upon.
Siggard
builds luxury custom homes. Siggard is
licensed as an attorney, contractor, and real estate broker. In April 2000, Siggard purchased a 10-acre
parcel in the La Cresta community.
Siggard’s parcel was crossed by a stream known as Bear Creek. Siggard’s parcel was undeveloped at the time
he purchased it, with the exception of two residential pads on the property and
utilities at the street. The residential
pads on the property were not certified by the County to be built upon. In order to build on the pads, a person would
need to have obtained a grading permit from the County, performed grading work,
and then have the work approved by the County.
Larry
worked as an engineer, an investment banker involved in the area of real estate
partnerships, and a real estate appraiser.
In 2000, the Hudacks were looking for a retirement home and discovered
the La Cresta community. The Hudacks appreciated
the open space provided by La Cresta; Larry planned to grow produce, such as
avocados, on his property. In August
2000, the Trust purchased two adjoining parcels in La Cresta. The Hudacks’ property was next to Siggard’s
property. The Hudacks received the La
Cresta restrictions, covenants, and bylaws when the property was
purchased.
One
of the Association’s bylaws provided:
“No building, garage, patio, outbuilding, fence or other structure shall
be constructed, erected, altered, remodeled, placed, maintained or be permitted
to remain on said Tract, or any portion thereof, unless and until three
complete sets of plans and specifications therefor, including finished grading
plans, plot plan showing location of such structure on the building site, floor
and roof plan, exterior elevations, sections and salient exterior details and
color scheme, including the type and location of hedges, walls and fences,
shall have been submitted to and approved in writing by any two (2) members of
the ‘Architectural Committee’ which shall be composed of not more than three
(3) members.â€
B. SIGGARD’S 2001 GRADING WORK
Siggard’s
property was crossed by dirt roads that were “fairly steep†and had become
rutted from erosion. In June 2001,
Siggard listed his parcel for sale at a price of $359,000. Also in 2001, Siggard used a skip loader to scrape
the roads flat—removing the ruts caused by water on the roads. Siggard also scraped the two pads to prevent
weeds from growing on them. Siggard did
not seek approval from the Association or a permit from the County to grade his
property because he believed approval and a permit were only required for
building a structure—approval was not needed for simply “moving dirt.†Larry and two other homeowners filed
complaints against Siggard with the Association. Larry complained Siggard was grading without
a permit, building residential pads, creating roads, and affecting a
stream. Complaints were also filed with
the County.
In
July 2001, Siggard received a “notice of non-compliance†from the County for
performing grading work without the necessary permits. As a result, Siggard attended a series of
administrative hearings. Siggard
negotiated with the County to remove an “Arizona crossing†from Bear Creek that
was on the property when Siggard purchased it.
An “Arizona crossing†is several pipes with dirt over the pipes. There were no permits for the Arizona
crossing. As part of that negotiation,
the County released the “notice of non-compliance,†effectively dismissing the
citation.
In
August 2001, the Association sent Siggard a letter reflecting that it concluded
he had not committed any violations because he was “not grading in preparation
to build a structure.†In that letter,
the Association cautioned Siggard that he could potentially violate the
covenants, conditions, and restrictions (CC&Rs) concerning drainage if he
performed erosion control work. Larry
also filed a complaint with the Department of Fish and Game concerning
Siggard’s grading work. Siggard received
a citation from the Department of Fish and Game. Siggard could not recall if he received any
offers to purchase the property in 2001.
C. SIGGARD’S ATTEMPTS TO SELL HIS
PROPERTY IN 2002 AND 2003
In
late 2002, Siggard prepared plans and a grading application for his
property. Siggard submitted his plans to
the County. In January 2003, the County
responded with a document entitled, “Plan Check Corrections from the Building
and Safety Department,†which reflected issues the County thought Siggard
should be prepared to address during the project such as (1) excessive grading,
(2) grading and drainage crossing Bear Creek, and (3) obtaining clearance
from the Army Corps of Engineers and Department of Fish and Wildlife for work
being done near Bear Creek. To address
the building department’s concerns, Siggard obtained a “biochemical consulting
report,†but then decided to pursue selling the property rather than obtaining
the grading permit. Thus, the permit
process went “dormant,†and the County refunded Siggard’s application fees. Siggard did not choose to sell the property
because of issues with the County, he decided to sell because he needed the
money at that time.
In
March 2003, Siggard submitted plans to the Association to grade the property
and construct a front wall, gate, and bridge.
The Association approved the bridge and grading portions of the
application, but denied the wall and gate plans. Siggard obtained the approvals in order to
help sell the lot. Siggard thought the
property would be more attractive if it came with some construction approvals.
Also
in March 2003, Siggard approached Larry to determine if Larry was interested in
purchasing Siggard’s property. Siggard
asked Larry for $325,000. According to
Siggard, Larry immediately agreed to purchase the property. According to Hudack, he asked for permission
to “walk the property and look it over.â€
Siggard gave Larry the engineering plans, “bio consulting plan,†the
building and safety department’s “Plan Check Corrections,†a purchase
agreement, and escrow instructions.
In
April 2003, Larry sent Siggard a letter with various questions and concerns
about Siggard’s property. For example,
Larry wanted the property lines of the lot to be clearly identified. Larry closed the letter by writing,
“Accordingly, I request that we agree that the price of the land to be
purchased shall be $200,000 and that the value of the plans and permit shall be
assigned a value of $125,000.â€
Siggard
tried to respond to Larry’s questions and
concerns. For example, Siggard hired a
surveyor to check the property lines.
After Siggard failed to hear from Larry for a month, Siggard called
Larry and asked, “‘Well, are you going to buy this or are you not?’†Larry responded to Siggard via letter. In the letter, Larry questioned Siggard’s
representation that a two and one-half acre primary home site could be
developed on the property, because it appeared the County would limit grading
to “‘no more than 15 percent’†of the property.
Larry wrote that the property was not worth the $325,000 purchase that
had been discussed. Larry offered
Siggard $265,000. Siggard was not
interested in selling the land at that price; Siggard had a $250,000 mortgage
on the property. The negotiations
between Larry and Siggard ended at that point.
Siggard turned his focus to building homes in other areas and trying to
sell other properties he owned.
D. SIGGARD’S GRADING WORK IN 2006
In
2006, the County was preparing to vote on an ordinance that Larry had mentioned
in his 2003 letter. If the ordinance
were approved, Siggard would have been limited to grading only 15 percent of
his property. In 2006, when the County
scheduled the vote on the “15 percent ordinance,†Siggard decided that if he
were going to put roads on the property “it was going to be then or never.†Siggard needed to alter the roads on the
property because some of them were so steep that “a regular car couldn’t get
up†them. Siggard also planned to plant
trees on the property, in order to enhance the property’s value. Siggard did not have the financial ability to
build a residence on the property, so he did not prepare any plans for
constructing a residence.
In
late January 2006, Siggard applied County’s Agricultural Commissioner for an agricultural exemption to the grading
permit process. Siggard believed the
agricultural grading permit would allow him to grade his property in support of
agricultural activities, such as planting trees, and to create roads and
driveways for access purposes. On the
application, Siggard wrote that he planned to move approximately 8,000 cubic
yards of dirt, remove brush, and possibly move the driveway. Siggard told the agricultural commissioner’s
assistant that he planned to plant avocado and citrus trees. Siggard indicated that he planned to perform
grading work on eight of the 10.2 acres.
No engineering plans were submitted as part of the agricultural grading
permit process; however, Siggard submitted an aerial photograph of the property
indicating where the grading would take place.
Siggard’s agricultural grading permit was approved on March 23, 2006. The permit required Siggard to implement
erosion controls as part of the grading project. Siggard’s erosion control plan was also
approved. On approximately March 25,
Siggard submitted his grading permit and maps of his grading plans to the
Association. The Association granted an
extension of the approval for Siggard’s 2003 grading application.
Siggard
ordered 200 avocado trees to be delivered by the end of summer 2006. Contractor was hired to perform the grading
work. On April 25, 2006, Contractor
began grading Siggard’s property.
Siggard told Contractor to make the roads “accessible,†ideally under a
15 percent hill grade. Contractor used a
bulldozer to perform the grading work.
On
approximately May 1, 2006, Larry saw “a really steep cut along [his] property
line.†Larry instructed Marianne to
contact the chairperson of the Association’s Architectural Committee to
determine if Siggard had permits and permission to be performing grading work. Larry went to Siggard’s property where he saw
“[a] heck of a lot of grading, moving an extremely large amount of dirt.†Larry saw “really steep cuts.†The cuts left an oak tree sitting on a
“pedestal,†as all the other earth had been pushed away from the tree. Larry saw a road was being graded that was
partially on the Hudacks’ property. The
chairperson of the Architectural Committee assured the Hudacks that Siggard had
permits and the committee’s approval to perform the grading work. For the next two weeks, the Hudacks watched
the grading work take place.
On
approximately May 15, 2006, Siggard’s grading work resulted in a dam being
built across Bear Creek. The dam was
created when machinery was moved across the creek. As the machinery moved across the creek, the
water became muddy. Siggard installed a
silt fence, but it was not effective.
Thus, Siggard installed an Arizona crossing. Siggard placed a 24-inch pipe in the creek
and covered it with dirt, so the machinery could move over the creek without
pushing dirt into the water.
On
May 17 the water in Bear Creek stopped flowing.
At that point, the Hudacks questioned the information given to them by
the chairperson of the Architectural Committee.
Larry contacted County’s Code Enforcement Unit to determine if Siggard
had grading permits. Larry discovered no
grading permits had been issued to Siggard.
Larry contacted the president of the Association’s Board of Directors
(the Board) and asked him to look at Siggard’s property because Larry believed
Siggard was violating the bylaws by damming Bear Creek.
On
May 17, the Board’s president looked at Siggard’s property from the property
line Siggard shared with the Hudacks.
Larry complained that (1) the grading was moving rocks and dirt on to
the Hudacks’ property, (2) Bear Creek had been disturbed, and (3) a spring that
fed oak trees on the Hudacks’ property had been rerouted. It appeared to the president that “there was
debris†on the Hudacks’ property and there had been “some disruption†to Bear
Creek. The president could not ascertain
if the spring had been rerouted. The
president said “he would see to it that a cease and desist [letter] would be
issued†to Siggard.
The
Association’s attorneys sent a letter to Siggard on May 18. The letter asked Siggard to cease and desist
from grading his property because Siggard did not have a grading permit. The letter warned that the Association could
file legal action, such as an injunction, against Siggard if he did not stop
grading his property. In response to the
letter, Siggard called the Board’s president, but he would not take Siggard’s
call. Thus, Siggard sent a letter to the
Association’s attorney. Siggard wrote
that the Association’s facts were incorrect, but even if they were correct, the
Association failed to state facts sufficient to support a cause of action. In a telephone conversation with the
Association’s attorney, Siggard referred the attorney to the agricultural
grading permit he filed with the Association’s management office. The Association did not file for an
injunction.
On
May 19, Siggard received a letter from the Hudacks’ attorney. The letter referenced the Association’s
CC&Rs, but did not cite a specific section for the proposition that Siggard
had to cease and desist from his grading work.
The letter also reflected that the grading work could be a violation of
environmental laws because it impacted a stream and possible protected species
habitat. Siggard continued to grade his
property. Siggard contacted the Hudacks’
attorney, who had sent the letter. The
Hudacks’ attorney informed Siggard that he had been fired by the Hudacks and
they were planning to sue Siggard. The
Hudacks’ attorney would not give Siggard the new attorney’s contact
information.
On
May 20, 2006, Larry wrote a letter to the Board’s president. In the letter, Larry accused Siggard of
grading “directly into Bear Creek.â€
Larry theorized that Siggard was using “an agricultural exemption as a
ruse or cover story to accomplish land clearing and massive earth movement that
would enable him to more favorably present and sell his 10 acre parcel.†Larry noted that “Siggard had an Agricultural
Exemption and [the County could] not shut him down,†but Larry also concluded
“Siggard had No PERMITS.â€
In
the letter, Larry faulted the Association for approving Siggard’s grading plans
without evidence Siggard had “appropriate county permits.†Larry asserted Siggard’s “grading caused a
material and substantial loss of property value for [the Hudacks’] adjoining
parcels.†Larry believed (1) the oak
trees on his property would die due to a lack of water from the spring; (2) mud
would move onto his property when it rained from the soft dirt piled “within
inches†of the Hudacks’ property; and (3) the Hudacks’ property would flood
when it rained due to the damming of Bear Creek. Larry wrote the Association “must consider
that [it] will either be a co-defendant or a plaintiff in this case . . . there
is no middle ground.â€
The
Board concluded they would be named in the lawsuit “one way or another,†so
decided not to take any particular action since the dispute concerned two
property owners within the Association.
When the Board informed Larry that it would not be joining him as a
plaintiff against Siggard, Larry replied, “The gloves are off. We’ll see you in court.â€
On
May 22, 2006, the director of County’s Building and Safety Unit sent an e-mail
to Larry informing him that his claims against Siggard would be investigated,
but that the investigation would require “some time to process due to very
specific notification requirements.â€
Larry went on to contact the agricultural commissioner, the code
enforcement unit, a County Supervisor, the California Environmental Protection
Agency, and the California Department of Fish and Game.
Larry
also contacted the Contractors State License Board. Larry accused Contractor of grading without a
permit and asked the licensing board to inquire into the status of Contractor’s
contracting license. Larry told the
licensing board that Contractor was “a rogue contractor.†Larry also took over 1,000 photographs of
Siggard’s property. Larry wrote in a
declaration, “I took hundreds of pictures; in some cases on a daily
basis.â€
E. COMPLAINT AND CROSS-COMPLAINT
The
Hudacks filed their original complaint, initiating the instant case, on May 25,
2006. The Hudacks sued (1) Siggard; (2)
Contractor; (3) the County; and (4) the Riverside County Planning
Department. The causes of action
included (1) breach of contract, (2) trespass, (3) encroachment, (4) nuisance
per se, (5) private nuisance, (6) negligence, and (7) a CEQA
violation. The CEQA cause of action
included allegations that all four defendants, “should have required an
Environmental Impact Report (EIR)†for the grading work done on Siggard’s
property. The Hudacks requested a
“[w]rit of mandamus to require the defendants to recognize that the defendants
[sic] grading project is subject to
CEQA and to require said defendants to comply with the CEQA act [
petition for a writ of mandate for April 2007.
After
receiving the Hudacks’ complaint, Siggard moved the boulders that had been
placed near the property line Siggard shared with the Hudacks. Siggard moved the boulders approximately 40
feet away from the property line, onto his property. Siggard moved the boulders because he was
hoping to “just get [the lawsuit] over with.â€
Additionally, on June 1, 2006, Siggard hired a civil engineer to create
a grading plan and a storm water pollution prevention plan. Siggard hired the civil engineer to create
the plans because he wanted to “get [the lawsuit] done.†Siggard thought to himself, “Look, if I do
all of these things, will [Larry] just leave me alone and let me proceed with
this?â€
On
June 15, 2006, the director of County’s Building and Safety Department sent an
e-mail to County Supervisor Bob Buster’s legislative assistant. In the e-mail, the director explained, “We
sent a grading inspector out to take a look and it was determined that []
Siggard is grading within the scope of his Ag. Registration. We did however, issue him a[ notice of
violation] for not having his erosion control in place. As you can tell from the e-mails, [Larry] is
not happy with my response and wants the project shut down. Unfortunately [] Siggard has not done
anything yet that would allow us to do that.
I’ll send a grading inspector out again and have them take another
look.â€
In
July 2006, Siggard and Contractor filed cross-complaints. In Siggard’s cross-complaint he sued (1)
Marianne, (2) Larry, (3) the Trust, (4) the County, and (5) County’s Planning
Department. Siggard included causes of
action for (1) a violation of CEQA; (2) trespass; (3) encroachment; (4)
nuisance; (5) civil conspiracy to defraud; (6) defamation, slander,
and libel; (7) interference with a prospective economic advantage; (8) slander
of title; and (9) intentional infliction of emotional distress.
F. INTERNET COMMUNICATIONS
On
July 30, 2006, Larry sent an e-mail to approximately 55 people with the subject
line, “Is this the way you really want things run?†Some of the people who received the e-mail
were members of the Association; however, some were not members. In the e-mail, Larry complained that the
Board was being “used as a tool of disgruntled violators whose sole aim is to
disrupt and corrupt our community,†because Larry believed the Board was
“acting as Siggard’s agent.†In the
e-mail Larry wrote that if it were necessary he would “make [i]t [his] life’s
work to file a complaint against each and every fence, entry gate, culvert, or
otherwise that [he] can identify [as being] in ‘violation’ anywhere in La
Cresta.†Larry then recommended people
“read the Chicken Little Story,†by clicking on a hyperlink Larry provided in
the e-mail.
The
Chicken Little Story appeared on Larry’s website, LCPOALaw.com. At trial, Larry described the story as “a
cartoon of mythical characters that was intended to bring a lighthearted or
humorous look at the situations going on in La Cresta.†Larry testified the characters in the story
were fictional. The story was set in “a
little kingdom on a hill,†where “a lot of chickens†lived. The chickens elected a board of directors,
and there were committees associated with the board. The story described one committee as having
“the job of making sure all the chickens built their hen houses just
right.†The committee was described as
“want[ing] to say yes to everybody, no matter how outrageous their plans or
proposal might be.†The story went on
for 12 pages. At trial, Larry denied the
story was based on real people.
The
Board president replied to Larry’s e-mail, including all the people that
received Larry’s original e-mail. The
president explained the Association’s complaint process to Larry, assured Larry
that “the rules are the same for everyone,†and stated no response could be
given about the situation involving Siggard because litigation was taking
place.
Larry
responded, again e-mailing a lengthy list of people, with a list of questions
and accusations against the Board. For
example, an excerpt of the e-mail reads:
“For you[r] information, Siggard has disclosed that you and Kannen did
cut a secret deal and agreed to let him continue grading after sending the
Cease and Desist letter. Unless he is
lying, you really did pull a fast one with your secret deal. Why would you do that? What did you hope to gain? [¶]
Why??? [¶] PS Thanks for confirming you have cut off all
communications in confirmation of my claims.
[¶] PSS Thanks for the heads
up. I’ll have a much better mailing list
for my next communication.â€
The
Board president replied to Larry’s e-mail with answers to Larry’s
questions. For example, the president
responded, “The[re] is no ‘secret’[]deal[,] never has been one and won’t be
one. We would NEVER cut a secret
deal.†Larry responded, still including
approximately 50 people. In the
response, Larry asserted the president did not answer his questions and concluded,
“We have accomplished nothing here.
We’ll address the appropriate questions in court.â€
G. ANTI-SLAPP MOTION
The
Hudacks responded to Siggard’s cross-complaint with an anti-SLAPP motion. In November 2006, Judge Cahraman ruled on the
anti-SLAPP motion. The trial court
granted the anti-SLAPP motion as it pertained to Siggard’s causes of action for
(1) defamation, slander, and libel; (2) interference with a prospective
economic advantage; (3) slander of title; and (4) intentional infliction
of emotional distress. The trial court
found Siggard was suing the Hudacks “for allegations set forth in [the
Hudacks’] legal pleadings.†The trial
court also found “there is nothing submitted that would demonstrate a
probability of prevailing on these causes of action.†The trial court also granted the Hudacks’
demurrer to Siggard’s cause of action for civil conspiracy to defraud, but
granted Siggard leave to amend.
On
November 21, 2006, the Hudacks filed a second amended complaint. The defendants were (1) Siggard; (2)
Contractor; (3) County; (4) County’s Planning Department; and (5) the
Association. The causes of action
included: (1) a violation of CEQA; (2)
trespass; (3) encroachment; (4) nuisance per se; (5) private nuisance;
(6) negligence; (7) breach of fiduciary duty; (8) breach of contract by
failing to enforce CC&Rs; and (9) negligence.
H. WRIT OF MANDATE AND CEQA RULINGS
The
hearing on the petition for a writ of mandate took place on April 4, 2007. After taking the matter under submission,
Judge Cahraman granted the writ on May 22, 2007. The writ directed County to “vacate and set
aside its approval of the agricultural exemption to the permit requirements;
and (2) take such action as may be necessary to bring the project into
compliance with [CEQA], sections 21000, et seq., of the Public Resources Code.â€
On
June 18, 2007, the Hudacks filed a motion requesting a hearing on the
additional remedies requested in their second amended complaint concerning the
alleged CEQA violation. In addition to
the writ, the Hudacks requested Siggard (1) be required to restore his property
to the condition it was in prior to his grading activity; and (2) “be
prohibited from seeking any discretionary land use approval for the Property
for a period of five (5) years.â€
On
September 5, 2007, County filed its initial return to the writ of mandate. The return reflected (1) County invalidated
Siggard’s agricultural grading exemption; and (2) an additional return to the
writ would be filed if Siggard applied for another grading permit or
agricultural exemption and County’s Building Department approved the permit or
exemption. Judge Cahraman held a hearing
on the Hudacks “additional remedies†motion on September 19, 2007, and took the
matter under submission.
On
November 15, 2007, the trial court denied, without prejudice, the Hudacks’
request to preclude Siggard from obtaining land use approvals. The trial court scheduled a hearing on the
request to direct Siggard to restore his property to its pregraded
condition. The trial court also
scheduled a hearing for an order to show cause “why the court should not refer
[the] matter to a referee.†The court
held a hearing on the restoration and referee issues on January 22, 2008, and
took the matters under submission.
On
February 7, 2008, the trial court appointed a referee. The trial court ordered the following factual
question be resolved: “What remedial
action, if any, should [] Siggard be required to perform with regard to the
changes he made to his land? The analysis
should be based on the environmental damage done and its effect on the Hudacks,
if any.†The trial court ordered Siggard
and the Hudacks equally share the cost of the referee. Judge Cahraman reassigned the case to the
civil master calendar department.
I. SALE OF SIGGARD’S PROPERTY
On
July 1, 2008, Siggard lost his La Cresta property to foreclosure. Washington Mutual Bank acquired Siggard’s
property. On August 4, 2008, the
Hudacks’ attorney, R. Keith McKellogg (McKellogg), sent a letter to the realtor
handling the sale of Siggard’s former property.
McKellogg wrote that he understood the listing price for Siggard’s
former property would be $400,000.
McKellogg offered for the Hudacks to purchase the property for
$50,000. McKellogg asserted the $400,000
listing price failed to take into account the $250,000 to $300,000 cost of
restoring the property to its pregraded condition.
Siggard’s
former property was purchased by Sergio and Laura Ochoa (collectively “the
Ochoasâ€) in January 2009. The Ochoas
planned to build a retirement home on the property. After purchasing the property the Ochoas
applied to the Association for permission to construct a fence across the front
of the property. The Ochoas also wanted
to remove a tree or bush that was located along the border with the Hudacks’
property. The Association approved the
fence but recommended the Ochoas introduce themselves to the Hudacks and ask
the Hudacks if it would be okay to remove the tree or bush.
Sergio
Ochoa (Sergio) called Larry. Sergio told
Larry about his plans to build a fence and remove a bush. Larry asked if the Ochoas had already closed
escrow. Sergio responded, “Yes,†and
asked, “Why?†Larry said the property
was involved in litigation, which Sergio had not known about. Larry told Sergio, “[Y]ou’re going to be in a
bunch of trouble,†due to the litigation.
Sergio and Larry agreed to meet in person. At the meeting, on February 14, Larry told
Sergio the details of the lawsuit. Larry
told Sergio that he would “give [him] some time to get out of the sale of the
property,†but that if Sergio remained the owner of the property then the
Hudacks would name the Ochoas as defendants in their lawsuit. Larry also offered to purchase the property
from the Ochoas but for “much†less than the Ochoas paid for it. Eventually, the Hudacks named the Ochoas in
their lawsuit.
J. REFEREE’S REPORT AND SIGGARD’S
DEMURRER
The
referee held an evidentiary hearing on April 30, 2009. In a proposed report, the referee found (1)
Bear Creek is a blue line stream
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“within the jurisdictional authority of the Department of Fish & Game and
is considered a sensitive habitatâ€; (2) there was a natural spring that
fed the oak trees on the Hudacks’ property, and that spring was dammed by the
2006 grading on Siggard’s property; (3) Siggard exceeded his agricultural grading
exemption by (a) grading for roads, and (b) excavating approximately
33,520 cubic yards of dirt; (4) Siggard’s property experienced substantial
erosion when it rains, which caused sediment to fall into Bear Creek; and (5)
the grading was done without proper soil compaction. The referee concluded the banks of Bear Creek
and the creek itself needed to be restored.
The
referee recommended the trial court (1) find Siggard and his successors in
interest “jointly and severally liable for all costs related to remediation of
the subject propertyâ€; (2) designate a project engineer to supervise the
remediation of the property; and (3) order the remediation be completed by
October 15, 2009.
In
September 2009, Siggard demurred to the Hudacks fifth amended complaint.
“does not specifically authorize an injunction in order for a property owner to
return [a] property to a pre-graded state.â€
In other words, the remedy the Hudacks were seeking did not comport with
the CEQA [cause of] action. Siggard
asserted the appropriate action under CEQA was for County to conduct an
environmental review.
Judge
Schwartz ruled on the demurrer. The
trial court concluded CEQA did not grant the court authority to issue an
injunction ordering Siggard to return the property to its pregraded
condition. The trial court reviewed the
referee’s report and noted that restoration of the property was never found to
be required by CEQA in that an environmental impact report was never
prepared. The court concluded it had the
authority to stop the grading, but ordering restoration would be problematic
because it would be a second project occurring on the property without an
environmental impact report. The court
held the proper remedy would be “to remand the project back to the lead agency
to conduct the appropriate review.†The
trial court sustained the demurrer to the Hudacks’ CEQA cause of action without
leave to amend. The trial court also
vacated the scheduled hearing to consider the referee’s findings.
K. THE HUDACKS BECOME OWNERS OF
SIGGARD’S FORMER PROPERTY
The
Ochoas filed a cross-complaint against the bank to rescind the sale of the
property. The Ochoas’ lawsuit “didn’t
get that farâ€â€”they “didn’t succeed in litigation.†The Ochoas sold Siggard’s former property to
the Hudacks. The Hudacks paid the same
purchase price as the Ochoas plus $20,000 for legal fees, but the Ochoas still
lost money on the transactions due to the payments of closing costs, attorneys’
fees, and taxes.
On
January 11, 2010, the Hudacks graded Siggard’s former property without a
permit, claiming reliance on an agricultural exemption and an emergency
notification filed with the Department of Fish and Game. Larry asserted he was grading in order to
mitigate the damage caused by Siggard’s grading, while also preparing the land
for farming. The Hudacks’ grading was
performed by an unlicensed contractor.
The
Association contacted County’s Code Enforcement Unit in regard to the Hudacks’
grading activity. Code Enforcement
Officer Farlow inspected the former Siggard property on January 12, 2010. Farlow saw “three small loaders working in
and around . . . a riparian feature.â€
Farlow spoke to Larry. Larry told
Farlow that he was trespassing. Larry
also told Farlow he was grading under an agricultural exemption. Farlow told Larry that the creek likely fell
within the jurisdiction of the Department of Fish and Game. Larry responded, “‘Fish and Game can deal
with my lawyer.’†After that comment,
Farlow left. Farlow discovered Larry
never applied for an agricultural grading exemption; however, he might not have
needed to apply since he was expanding his farming activity from a parcel he
owned onto Siggard’s former property.
On
March 5, 2010, the Association’s management company sent the Hudacks a cease
and desist letter, directing them to stop grading their property because they
had not applied to the Association’s Architectural Committee for approval of
the grading work.
L. PRETRIAL DISCUSSIONS
Judge
Holmes presided over the trial and pretrial motions. On July 12, 2010, the trial court ordered the
parties to work together to create jury instructions and a special verdict
form, prior to the jury being selected.
On July 15, the parties submitted proposed instructions. The court issued a ruling on the proposed
instructions. The parties also presented
the trial court with a joint special verdict form.
longest special verdict form I have ever seen, but that may not be a bad thing. I’m trying to convince myself.â€
On
July 19, the trial court and the parties finalized the instructions. The court discussed the special verdict form
and the various changes proposed by the parties. Eventually, the trial court validated the
special verdict form that was submitted in the days prior to July 19. The special verdict form was 20 pages long
and included 92 questions.
M. TRIAL
During
trial, Siggard testified that the Hudacks trespassed and encroached on the
northwest corner of his property by constructing a road that entered three or
four feet onto his property and went a distance of approximately 100 feet along
his property. Siggard was unsure the
value of the damages caused by the alleged trespass and encroachment, but
asserted he was unable to use the portion of his property that was encumbered
by the road.
Siggard
asserted the Hudacks created a nuisance on his property by “intentionally and
maliciously [tying his] property up so that [he] could not sell it, could not
use it, and caused [him] to lose his property.â€
Siggard also asserted the Hudacks created a nuisance by causing him to
be unable to plant 200 avocado trees.
Siggard testified he was not aware of the Hudacks creating an
unhealthful condition on his property.
Siggard estimated the damage for the nuisance to be “[i]n excess of a
million dollars.†Siggard based the
estimate on “[t]he value of the lot at the time it was tied up, as opposed to
what was owed at the time it was ti[ed] up.â€
Siggard believed the Hudacks should pay for the various expenses he
incurred, for which he was unable to recover due to being unable to sell the
property, such as the money spent on property taxes, engineering plans, and
grading. The million dollars also
included the time Siggard spent representing himself as an attorney in the
Hudacks’ case—time that Siggard could have spent earning money. Siggard appeared in pro per until
approximately 60 days before trial.
In
regard to his intentional infliction of emotional distress claim, Siggard
testified that he suffered “[s]leeplessness, suicidal thoughts, homelessness,
lack of prestige in the community, [and] slander.†Siggard said he did not receive medical
treatment for these issues because he was unable to afford such treatment. Siggard testified he had been homeless for
approximately one year and was homeless at the time of trial.
N. INSTRUCTIONS
The
trial court gave the jury the following instructions concerning Siggard’s
damages: “Now, here are the specific
items of economic damages claimed by Cross-Complainant [] Siggard: The Christensen survey; the cost of grading
in 2006; number 3, the cost of the agricultural exception to the grading
permit; number 4, the harm to [] Siggard’s property. To recover damages for harm to property, []
Siggard must prove reasonable out-of-pocket loss, and the cost of repairing the
harm. To determine whether out-of-pocket
loss and the cost of repairing [the] harm is reasonable, you must decide if
there’s a reasonable relationship between the cost of repair and the harm
caused by the Hudacks’ conduct. You must
consider the expense and time involved to restore the property to its original
condition compared to the actual value of the property. If you find that the cost of repairing the
harm is not reasonable, you may award any reduction in the property’s value;
and the fifth item of economic damages claimed by [] Siggard, the loss of use
of his property. To recover damages for
the loss of use, [] Siggard must prove the benefit obtained by the Hudacks
because of their wrongful occupation.â€
O. CLOSING ARGUMENT
During
Siggard’s closing argument, Siggard’s attorney, Craig Rossell (Rossell), argued
the Hudacks “committed a gross nuisance as towards [] Siggard, because they
interfered with his loss and enjoyment of the property and life. That’s what nuisance is.â€
In
regard to economic damages, it appears from the record Rossell was referring to
a document, slide, or other projected image while presenting his argument. Rossell argued: “Damages of [] Siggard, economic
damages. There’s the purchase price, and
here is the 2003 development expense, and we broke that out ever so
slightly. Then there’s the 2006
surveying expense, and there’s the 2006 grading with [Contractor]. Then, there’s some more expense of 2006, LSA,
and the [storm water pollution prevention plan], that wasn’t necessary. Mr. Miller testified it wasn’t
necessary. The conservation plan that
was already in the original application was sufficient. That’s what he told us, and yet [] Siggard
was given notice [of] violation as a result of [Larry]’s excessive campaign to
discredit him. He incurred another
$11,000 for a [storm water pollution prevention plan], and he only needed one
or the other. We have erosion control
materials that were laid down in 2006.
We have lost equity on the parcel.
How do we get at that? We take
the Noble Tucker fair market value estimate, and we back out what was
owed. [] Siggard originally said three
and a quarter. [McKellogg] corrected
him. It was 364. So we took the right number and we backed it
out, and we got 236. Then we have
property taxes for an eight year period, homeowner fees for that same period,
and it gives us a total of $462,200.
That’s what we claim his out-of-pocket damages are for interference,
loss of use and enjoyment of the property, property rights and life. That’s the economic part.â€
P. VERDICT
First,
the jury found Siggard encroached on the Hudacks’ property, but the
encroachment was not a substantial factor in causing harm to the Hudacks. Second, the jury found Siggard trespassed on
the Hudacks’ property and that the trespass was a substantial factor in causing
harm to the Hudacks; however, the jury concluded Siggard did not intend to harm
the Hudacks. Third, the jury found
Siggard was negligent, but concluded Siggard’s negligence was not a substantial
factor in causing harm to the Hudacks.
Fourth, the jury found Siggard’s grading activities did not violate a
County ordinance. Fifth, the jury found
Siggard did not create a private nuisance.
Sixth,
the jury found the Hudacks encroached on Siggard’s property, but they did so
with Siggard’s permission. Seventh, the
jury found (a) the Hudacks created a condition that was harmful to health;
which (b) interfered with Siggard’s use or enjoyment of his land; (c) a
reasonable person would have been annoyed or disturbed by the Hudacks’ conduct;
(d) the Hudacks’ conduct was a substantial factor in causing harm to Siggard;
and (e) the seriousness of the harm to Siggard outweighed the public benefit of
the Hudacks’ conduct. Eighth, the jury
concluded Marianne conspired with Larry to injure Siggard. Ninth, the jury found the Hudacks engaged in
trespass and nuisance with malice, oppression, and fraud. For the nuisance cause of action, the jury
awarded Siggard $437,200 for economic losses and nothing for non-economic
losses. The jury awarded Siggard
punitive damages in the amount of $167,500.
Q. MOTION FOR JUDGMENT NOTWITHSTANDING
THE VERDICT
On
November 12, 2010, the Hudacks filed a motion for a judgment notwithstanding
the verdict (JNOV). The Hudacks asserted
Siggard’s private nuisance cause of action was “focused exclusively on the
Hudacks’ communications with public officials and the CEQA cause of
action.†The Hudacks argued that their
communications were “absolutely privileged†due to the litigation
privilege. The Hudacks reasoned that
since Siggard’s nuisance claim was “based solely on the Hudacks’ right to
access the courts[, n]o admissible evidence supports this cause of action and
it cannot stand.â€
The
Hudacks argued the issue was already settled when Judge Cahraman ruled on their
anti-SLAPP motion. The Hudacks argued
Siggard’s nuisance claim was a “‘back door’†method of introducing “improper
evidence,†after the anti-SLAPP ruling.
Judge
Holmes ruled on the Hudacks’ JNOV motion.
In denying the motion, the trial court wrote, “A preliminary ruling on
an anti-SLAPP motion does not amount to an exclusionary rule. Substantial and relevant evidence at trial
proved a cause of action not affected by the SLAPP ruling, and no law precluded
its introduction and consideration by the jury.
Much more evidence was adduced showing the Hudacks’ misconduct than just
communications to public officials:
among other things, there were repeated contacts about [] Siggard with
[the] Association officials and other neighbors, some 60 emails to these and
other individuals, and threats made to the whole La Cresta community shown at
trial.â€
R. MOTION FOR NEW TRIAL
On
November 22, 2010, the Hudacks filed a motion for new trial. First, the Hudacks asserted there was a
“fatal inconsistency between [an] instruction and [the] special verdictâ€
form. The Hudacks pointed out that the
private nuisance instruction defined a nuisance as occurring if the Hudacks or
Siggard interfered with one another’s “comfortable enjoyment of life or
property,†while the special verdict form asked the jury whether Siggard’s
interference created a condition that was harmful to the Hudacks’ health. The Hudacks argued that their private
nuisance cause of action “was not premised on a contention that Siggard created
a condition that was harmful to their health,†and the jury was not instructed
on the health issue, so therefore the “inconsistency renders the verdict ‘against
law’ and mandates a new trial against Siggard.â€
Second,
the Hudacks’ argued “the jury was improperly allowed to second guess the
portion of the judgment in this case finding that Siggard’s grading violated
[County] Ordinance 457,†which concerned grading. The Hudacks pointed out that the first
question on the special verdict form for the nuisance per se cause of action
was whether Siggard’s grading activities violated County Ordinance 457. The jury found Siggard’s grading did not
violate the ordinance. The Hudacks
argued this was problematic because the violation of the ordinance was res
judicata or law of the case, because Judge Cahraman wrote in his ruling, “‘In
March of 2006, [Siggard] obtained an agricultural exemption f[ro]m the
requirement of a grading permit, pursuant to Riverside County Ordinance
457. Respondent County conducted no CEQA
review whatsoever prior to granting that exemption. . . .[â€] (Italics omitted.) The Hudacks asserted Judge Cahraman’s ruling
granting the writ was “fully conclusive†on the finding that Siggard violated
County’s ordinance because “Siggard had no grading permits and did not have a
valid exemption.â€
Judge
Holmes ruled on the motion for new trial.
In the trial court’s ruling it wrote:
“Judge Cahraman’s writ of mandate was directed to the County of
Riverside based on what he found to be its violation of the California
Environmental Quality Act. He did not
find that Siggard’s grading violated County Ordinance 457, and there was
conflicting evidence presented on that point.
“Based
on all the evidence presented to the jury over the weeks of trial, it could
well have heeded the [private nuisance jury instruction] and still rendered its
same verdict. Further, all counsel
approved both the instruction and the special verdict form, and no objection
was made when the verdict was read out by the courtroom assistant.â€
A. PRIVATE NUISANCE
1. CONTENTIONS
The
Hudacks contend the trial court erred by denying their JNOV motion because the
evidence supporting Siggard’s private nuisance cause of action was the same
evidence Judge Cahraman found to be protected communications when ruling on the
anti-SLAPP motion. Additionally, under
the same point heading, the Hudacks assert “substantial evidence†does not
support the private nuisance verdict because “communicative acts†cannot form
“the sole basis of liability for private nuisance†on land. (Cal. Rules of Court, rule 8.204 [separate
headings].) We disagree with both
contentions.
2. PROTECTED
COMMUNICATIONS
We
begin with the Hudacks’ assertion that the trial court erred by denying their
JNOV motion because the court “completely ignored Judge Cahraman’s prior
holding that all of the alleged communication and conduct by the Hudacks, as a
matter of law, was ‘permissible communications and conduct in pursuit of the
right to petition.’†It appears the
Hudacks are raising the following argument:
The court determined, in the anti-SLAPP ruling, that the Hudacks’
communication and conduct was protected activity; therefore, any evidence that
was brought up in that anti-SLAPP motion could not be used in the trial,
because it was determined to be privileged and that ruling bars any
contradictory evidentiary ruling.
Typically
we review denials of JNOV motions for substantial evidence; however, if an
issue raises purely legal questions then we apply the de novo standard of
review. (Wolf v. Walt Disney Pictures and Television (2008) 162 Cal.App.4th
1107, 1138.) The Hudacks’ contention
raises a legal issue, so we apply the de novo standard.
The
Hudacks’ argument is not persuasive because it fails to take into account the
second prong of the anti-SLAPP analysis.
An anti-SLAPP analysis has two prongs (1) is the defendant’s
alleged activity protected, and (2) is there a probability the plaintiff will
prevail on the claim? (Code Civ. Proc.,
§ 425.16, subd. (b)(1).) The Hudacks’
argument concerns only the first prong.
They assert the activity is protected and therefore the evidence cannot
be used at trial. The Hudacks have
forgotten the second prong requiring the issue to be reconsidered for each
cause of action. An anti-SLAPP ruling is
not a blanket finding that evidence must be excluded throughout trial. As the trial court noted, an anti-SLAPP
ruling is not an evidentiary ruling.
However, even if it were an evidentiary ruling, the second prong would
require an analysis to be performed for every cause of action.
For
example, if the anti-SLAPP analysis in this case resulted in a finding that the
evidence was protected, but Siggard had a probability of prevailing on his
defamation cause of action, then the evidence could have been admitted to prove
defamation despite the activity being protected—a finding of protected activity
under an anti-SLAPP analysis does not mean evidence is automatically
excluded. Parties must meet both prongs
of the anti-SLAPP analysis and then the court will strike “the cause of action.†(§
425.16, subd. (b)(1), italics added.)
Evidence is not stricken under an anti-SLAPP analysis, but even if it
were, it would be for a single cause of action
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