SOUTH SUTTER v. LJ SUTTER PARTNERS









Filed 3/16/11




CERTIFIED FOR PUBLICATION



IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
THIRD APPELLATE DISTRICT
(Sutter)
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SOUTH SUTTER, LLC, Plaintiff and Appellant, v. LJ SUTTER PARTNERS, L.P., et al., Defendants and Respondents.	C058206 (Super. Ct. No. CV-CS-07-2068)
SOUTH SUTTER, LLC, Plaintiff and Appellant, v. ANDERSON WEST, LLC, Defendant and Respondent.	C059554 (Super. Ct. No. CV-CS-07-2068)

STORY CONTINUE FROM PART I….


F. Sutter II lawsuit
Meanwhile, back on June 22, 2007, South Sutter filed a new complaint in Santa Clara County Superior Court against the Leal defendants, the Miller defendants, and Anderson West.^[1],[2] (Santa Clara County Super. Ct. case No. 107CV088499.) The parties refer to this action as Sutter II. This appeal arises from the trial court's judgment on the Sutter II complaint.
South Sutter filed Sutter II about one month after dismissing Sutter I, about one month after the County rejected the Miller defendants' specific plan application for filing, and about two months before the Miller defendants filed their motion for attorney fees for the anti-SLAPP motion in Sutter I.
In Sutter II, South Sutter omitted its tort causes of action that had been included in Sutter I. It also omitted all of its prior allegations from the Sutter I complaint regarding any activities by defendants opposing South Sutter's development of the Option Property, including any references to the Leal defendants and Miller defendants submitting a competing specific plan application to the Board of Supervisors or County staff. Other than those changes, Sutter II contains no new or additional facts from those alleged in Sutter I.
Sutter II alleged causes of action only for breach of contract against the Leal defendants and for declaratory relief against the Leal defendants, the Miller defendants, and Anderson West. South Sutter alleged that each defendant acted as the agent of every other defendant, and each was a necessary and indispensible party.
South Sutter claimed the Leal defendants breached section 13.1 of the Option Agreement by failing to provide South Sutter with notice and a right of first refusal to participate in the joint venture with Anderson West for the acquisition, ownership and development of the Brennan Tract.
South Sutter sought declaratory relief as to all defendants, claiming disputes had arisen with them regarding, among other matters, (1) whether the Option Agreement grants South Sutter an exclusive right to seek development entitlements for the Option Property and to develop that property; (2) whether the Option Agreement prohibits the Leal defendants, acting solely or through an agent (presumably, the Miller defendants) from seeking development entitlements for the Option Property or attempting to develop the Option Property; (3) whether the Option Agreement prohibits the Leal defendants from entering into agreements, including the Miller Option Agreement, to transfer, sell, or option any of the Other Property; and
(4) whether the Option Agreement prohibits the Leal defendants, acting solely or through an agent, from seeking development entitlements for the Other Property.
South Sutter also sought a declaration that Odysseus Farms violated the Option Agreement by entering into the Miller Option Agreement with LJ Sutter for the Other Property. It asked the trial court to declare the Miller Option Agreement void and to nullify or rescind it.
Counsel for defendants objected to Sutter II's choice of venue. By stipulation of the parties, Sutter II was transferred to Sutter County Superior Court, where it was received on or about October 23, 2007. (Sutter County Super. Ct. case No. CV-CS-07-2068.)
G. Miller Defendants' anti-SLAPP motion in Sutter II
More than 60 days after Sutter II was filed but less than 60 days after Sutter II was received by the Sutter County Superior Court, the Miller defendants filed an anti-SLAPP motion to strike the Sutter II complaint as against them.
In their anti-SLAPP motion in Sutter II, the Miller defendants argued they had already met their prima facie burden of showing Sutter II arose out of constitutionally protected conduct because the trial court had determined Sutter I was a SLAPP in their attorney fees motion and South Sutter had alleged no new facts in Sutter II. They claimed South Sutter as a matter of law could not file what was effectively an amended complaint after the trial court determined it would have dismissed Sutter I as a SLAPP.^[3]
The Miller defendants further argued that South Sutter filed Sutter I and Sutter II to prevent them from filing competing development applications with the County and participating in the approval process of South Sutter and the Measure M Group's specific plan application. The Miller defendants filed with the court a copy of the minutes of the County Board of Supervisors' meeting of April 24, 2007, where the Board of Supervisors rejected the Miller defendants' competing specific plan application. The Board noted, however, that the Miller defendants could submit alternative land use plans or environmental comments during the environmental review of the Measure M Group's specific plan application. Sutter II, the Miller defendants argued, aimed to stop them from participating in that process.
The Miller defendants also claimed Sutter II, when considered on its own merits, failed to survive the new anti-SLAPP motion as South Sutter failed to show a probability of success on the merits against them. South Sutter had no claim against the Miller defendants because they were not parties to the Option Agreement between South Sutter and Odysseus Farms. Even if South Sutter had a claim against the Miller defendants pursuant to section 12.1 of the Option Agreement, the provision allegedly granting South Sutter an exclusive option in the Other Property, that claim had not ripened because South Sutter had not fulfilled section 12.1's condition precedent for the option to come into existence.
Opposing the anti-SLAPP motion in Sutter II, South Sutter initially claimed the Miller defendants had failed to file the motion in a timely matter. They argued the motion was to be filed within 60 days of service of the complaint, and it had been filed more than 60 days after the Sutter II complaint had been served, excluding the time when the action was transferred to Sutter County.
On the merits of the motion, South Sutter argued Sutter II did not arise from an act in furtherance of the Miller defendants' speech and petition rights, but rather arose from a controversy over property and contract rights; specifically, the two option agreements and the rights under each. South Sutter asserted that any exercise of constitutional rights by the Miller defendants was incidental to the contract dispute.
South Sutter also argued the Miller defendants could not rely on the trial court's attorney fees order in Sutter I to establish their prima facie showing in the anti-SLAPP motion in Sutter II. Sutter II involved a different cause of action, one for declaratory relief, and the trial court had stated its ruling on the merits of the anti-SLAPP motion in Sutter I was limited to its determination for awarding fees.
Additionally, South Sutter argued it had substantiated a legally sufficient claim to survive an anti-SLAPP motion. It allegedly had established the minimal merit required to survive an anti-SLAPP motion against a complaint for declaratory relief by demonstrating the existence of a controversy over the meaning of the Option Agreement. Furthermore, the Miller defendants were indispensible parties to South Sutter's breach of contract action against the Leal defendants. If South Sutter prevailed against the Leal defendants and sought specific performance of its alleged exclusive right under the Option Agreement to acquire the Other Property, any rights the Miller defendants purported to have in the Other Property would be injured.
H. Trial court's ruling on anti-SLAPP motion in Sutter II
The trial court granted the anti-SLAPP motion to strike Sutter II. Initially, it ruled the Miller defendants had filed their anti-SLAPP motion in a timely manner. The transfer of venue started the 60-day time period anew, and the Miller defendants had filed their anti-SLAPP motion within 60 days after Sutter II was received by the Sutter County Superior Court.
The trial court determined the Miller defendants had met their prima facie burden of proving Sutter II arose from their exercise of constitutional rights of speech and petition. They established this by showing the primary right at issue in Sutter II is the same primary right that was at issue in Sutter I, and the action on that right had been determined in the attorney fees motion to have been a SLAPP. As a result, all Sutter II does is omit the allegations that led to the first anti-SLAPP motion, hoping a new filing will escape the fate of the first complaint.
Relying on Simmons v. Allstate Ins. Co. (2001) 92 Cal.App.4th 1068 (Simmons), the trial court ruled that refiling the Sutter I complaint as Sutter II but without the offending allegations was improper because, as we held in Simmons, there is no provision in the anti-SLAPP statute for amending a complaint once a court finds the necessary connection to First Amendment rights. The trial court stated: â€