Opinion
I. INTRODUCTION
In 2006, a dispute arose between plaintiff John Delois, then a tenant of defendants’ in a “live/work” space on Harrison Street in San Francisco, and defendants. The dispute, described in more detail below, was purportedly resolved by a written agreement between the parties. But various and sundry factors led to alleged breaches of that agreement; in any event, plaintiff did not vacate the premises on the date agreed upon in the settlement agreement and, as a result, defendants did not forgive the past due rent or return the security deposit as they would have done pursuant to that agreement.
After vacating the premises, plaintiff filed a 10-cause-of-action complaint against defendants alleging, e.g., various torts and breaches of contract regarding defendants’ actions. Defendants countered with a SLAPP (strategic lawsuit against public participation) motion under Code of Civil Procedure section 425.16 (section 425.16) asking that all 10 causes of action be stricken. The trial court ruled that defendants had satisfied the first prong of that section as to all 10 causes of action, but not the second prong as to four of them. It thus struck six of plaintiff’s causes of action (essentially tort causes of action), but declined to strike the remaining four (mainly contractual) causes of action. Defendants appeal the order insofar as it fails to strike three of the remaining four causes of action. (They concede that the trial court’s order was correct as to respondent’s first cause of action, which sought declaratory relief.)
Plaintiff cross-appeals from the order insofar as it struck six of his causes of action, contending that none of those claims satisfies the first prong of section 425.16. We agree with that contention and hence reverse the trial court’s order.
*944 II. FACTUAL AND PROCEDURAL BACKGROUND
From 1995 to 2006, plaintiff was a tenant in a “live/work” space owned by defendant Barrett Block Partners, a limited partnership, at 743 Harrison Street in San Francisco. At that space, plaintiff operated a business known as “The Clay Studio.” Defendant John Barrett (Barrett) is the general partner of the limited partnership.
Sometime in either 2000 or 2001, Caltrans (Department of Transportation) notified defendants that it intended to cut off access from the 743 Harrison building to Perry Street (a short street running parallel to Harrison Street apparently behind that building) in order to do a retrofit of part of the 1-280 freeway. Defendants negotiated a monetary settlement for that cutoff and, at about the same time, agreed to reduce the rent plaintiff paid for his unit.
In 2004, defendants advised plaintiff that they had no immediate plans to alter the property and that he had been an “ideal tenant, and . . . could stay in the building as long as [he] wanted.” As a result, plaintiff did not consider alternative spaces and anticipated a renewal of his lease in 2005. However, later in 2004, defendants decided to redevelop the property as condominiums, obtain the entitlements and permits needed to do so, and then sell the property. They did not advise plaintiff of these plans.
On or about June 3, 2005, defendant Barrett wrote to plaintiff regarding a new lease, the prior one having expired on February 28, 2005. He proposed a substantial increase in plaintiff’s rent, i.e., to $7,200 per month. Plaintiff countered with a proposal of a lesser increase, and an oral agreement was reached that plaintiff’s rent would be $5,033 per month from October 2005 until October 2006. Plaintiff paid, and defendants apparently accepted, that amount of rent starting in October 2005.
In early 2006, plaintiff learned of a San Francisco Planning Commission hearing on defendants’ proposed project to transform the property into a condominium complex to be known as “Gardens at Harrison Street.” He attended that hearing on February 16, 2006, with a group opposing the change, and believed that Barrett saw him there. At that hearing, the operation of “The Clay Studio” on the premises was specifically mentioned several times by speakers protesting the proposed zoning change. Plaintiff later wrote a letter to the planning commission opposing the proposed change.
After that hearing, plaintiff received a notice from defendants increasing his rent to $8,900 per month. On July 19, 2006, defendants served him with a “Three Day Notice to Pay Rent or Quit.” That notice advised that, if plaintiff did not quit the premises, defendants would “commence legal proceedings against [him].”
*945 Plaintiff paid the requested $8,900 rental amount for the month of July 2006 and the parties commenced negotiations to resolve their dispute. In August 2006, they executed a “Tenancy Termination Agreement” requiring plaintiff to vacate his “live/work” space by November 1, 2006, and leave the premises in “broom clean condition.” In consideration of that, defendants promised to (1) return plaintiff’s security deposit, (2) require plaintiff “to pay only $5033.00 per month on the first of each month until he vacates” with the balance of the set rate of $8,900 to be “waived if the Tenant vacates on or before the Termination Date and meets all other obligation [szc] of this Agreement.”
On August 9, 2006, defendants also executed a “To Whom It May Concern” letter stating that plaintiff had “paid his rent on time” since becoming a tenant in March 1995.
Plaintiff did, in fact, move out, but a “couple of days” after the agreed-upon November 1, 2006, date. This delay was at least partially because Caltrans was blocking the loading doors in the back of the property and the front door was too small. Additionally, Barrett allegedly refused to allow plaintiff an additional couple of days’ occupancy at a per diem rate. Per defendants in a letter to plaintiff on December 15, 2006, plaintiff did not leave the premises in “broom clean condition.” 1 More significantly, defendants enforced their monetary remedies under that agreement, and charged plaintiff the full $8,900 rent for the interim months and did not refund his security deposit. As of December 15, 2006, defendants claimed plaintiff owed them slightly under $15,000.
Plaintiff filed his 10-cause-of-action complaint on October 30, 2007. In it, his principal charging allegations were that (1) he was “forced to vacate the residential unit ... in violation of the provisions of the San Francisco Residential Rent Stabilization and Arbitration Ordinance,” (2) “as a result of the false promises and misrepresentations of Defendants,” he had “entered into a void contract relating to said premises,” (3) defendants had “made false representations that the building was going to be demolished and that permits had been obtained, that Plaintiff would have money returned to him, and that Defendants would cooperate in allowing Plaintiff to vacate the premises, and [(4)] all of this was motivated by defendants’ “illwill [sic], with the desire to trick Plaintiff and to harm him for LANDLORD’S pecuniary advantage and out of spite.”
*946 As noted, there followed 10 causes of action for, respectively, declaratory relief, misrepresentation, breach of contract, conversion, unfair business practices (under Bus. & Prof. Code, §§ 17200 & 17500), unjust enrichment, breach of fiduciary duty, breach of the covenant of good faith and fair dealing, constructive trust, and violation of the San Francisco Residential Rent Stabilization and Arbitration Ordinance (S.F. Admin. Code, ch. 37).
Defendants filed their section 425.16 motion on April 14, 2008. The trial court heard oral argument on it on May 6, 2008, after having issued a tentative ruling the previous day. It ruled that the first prong of the SLAPP motion regarding the nature of the claim had been sustained by defendants’ moving papers as to all 10 causes of action, but that defendants had not sustained the second prong of the statute as to four of the 10 causes of action, i.e., failed to establish that plaintiff had not alleged and could not prove a prima facie case as to four causes of action, namely, those for declaratory relief, breach of contract, unjust enrichment, and breach of the covenant of good faith and fair dealing.
Defendants filed their notice of appeal on May 20, 2008; plaintiff cross-appealed on June 11, 2008, claiming that section 425.16 did not apply to any of his alleged causes of action.
HI. DISCUSSION
A trial court order either granting or denying a section 425.16 motion is appealable. (See § 425.16, subd. (j).) And “[wjhether section 425.16 applies and whether the plaintiff has shown a probability of prevailing are both reviewed independently on appeal.”
(ComputerXpress, Inc.
v.
Jackson
(2001)
Because of the large number of appellate decisions construing and applying section 425.16, we have many options from which to choose to summarize the key features of that law and the issues an appellate court must address in reviewing a case arising under it. Given that wide choice, we opt to quote from our own recent decision in
Feldman v. 1100 Park Lane Associates
(2008)
The issue we face here is, shortly and simply, whether plaintiff’s 10-cause-of-action lawsuit satisfied the first prong of section 425.16, i.e., was it designed “to chill or punish [defendants’] exercise of constitutional rights to free speech and to petition the government for redress of grievances.”
(Rusheen
v.
Cohen
(2006)
To recapitulate the key facts noted above: Plaintiff rented the “live/work” space at 743 Harrison Street from defendants in 1995 and both resided and operated his “The Clay Studio” business there for over a decade. In 2004, defendants decided to undertake to redevelop the property into condominiums. However, according to the pleadings filed below by both parties, *948 apparently defendants never told their lessees, including plaintiff, about this. Indeed, in their opening brief to us, defendants do not assert—or even hint—that there was any such advice; rather, they state, citing plaintiff’s declaration in the trial court, that they “told Plaintiff that [they] had no plans for the property” as of 2004. But, in fact, according to them, defendants “wanted to recover the Property in order to redevelop it as a mixed commercial/residential development.”
In 2005, the parties attempted to negotiate a new lease for the premises; they were unsuccessful in those efforts, with the result that, in 2006, defendants served plaintiff with a three-day notice to quit. Importantly, however, no unlawful detainer action was ever filed by defendants; rather, what they repeatedly term a “settlement agreement,” i.e., the Tenancy Termination Agreement, was negotiated between the parties and signed in August 2006. It required plaintiff to vacate the premises on or before November 1, 2006. Both sides agree that plaintiff was a “couple of days” late in vacating those premises, and defendants claim he also did not leave them in “broom clean” condition. However, and as noted earlier (see fii. 1, ante), defendants’ own brief to us suggests that most, if not all, of the material left behind after plaintiff vacated the unit belonged to either defendants or others. In any event, as a result of plaintiff’s late departure and alleged lack of a “broom clean” unit, defendants assessed him almost $15,000 and also did not return his rental deposit or other rent payable under the Tenancy Termination Agreement. Or, to put it as defendants do in their opening brief to us: “Plaintiff expected the consideration due to him under the agreement if he performed. Instead, Defendants enforced their rights for Plaintiff’s breach.” Thus, per defendants, it was the denial of “the consideration due [plaintiff] under the agreement” and defendants’ enforcement of “their rights for [his] breach” which triggered plaintiff’s October 2007 complaint.
The trial court found that these facts satisfied the first prong of section 425.16. It stated: “Defendants’ anti-SLAPP motion is based on the contention that every claim Plaintiff brings arises from a settlement agreement that was entered into to avoid litigation . . . . [f] Defendants correctly state that settlement agreements, being a part of the litigation process, are protected activity under CCP section 425.16. That includes ‘communications preparatory or in anticipation of bringing an action.’ [Citations.] The Court finds that defendants have met the first prong of Section 425.16.”
We disagree with this analysis, because it runs contrary to both (1) authority concerning lawsuits designed to enforce agreements generally and (2) recent authority regarding the application of the SLAPP statute to landlord-tenant disputes. Those authorities establish that where, as here, no litigation is ever commenced—although possibly contemplated by one side or *949 another—but, rather, an agreement entered into to resolve the parties’ disputes, a later suit alleging breach of that agreement and related tortious conduct does not constitute the sort of activity encompassed by the SLAPP statute’s first prong.
A prime example of a case holding that actions intended to enforce “settlement agreements” does not come within the first prong of the SLAPP statute is
Applied Business Software, Inc. v. Pacific Mortgage Exchange, Inc.
(2008)
The trial court denied the SLAPP motion and the appellate court affirmed, and did so in words relevant to defendants’ arguments in this case regarding agreements in settlement of actual or anticipated litigation: “Here, the gist of plaintiff’s complaint is not that defendant did something wrong by acts committed during the course of the underlying federal action, but rather that defendant did something wrong by breaching the settlement agreement after the underlying action had been concluded. Under the explanatory provisions in subdivision (e) of section 425.16, defendant’s entering into the settlement agreement during the pendency of the federal case was indeed a protected activity, but defendant’s subsequent alleged breach of the settlement agreement after the federal case was concluded is not protected activity
because it cannot be said that the alleged breaching activity was undertaken by defendant in furtherance of defendant’s right of petition or free speech, as those rights are defined in section 425.16. Thus, the instant suit is based on alleged conduct of defendant that is not protected activity.” (Applied Business, supra,
*950
The same principle applies to the drafting and execution of an agreement before the relevant litigation commences. Thus, in
Moore
v.
Shaw
(2004)
Recently, the same principle as to the limits of a “protected activity” under the SLAPP statute has been applied in landlord-tenant dispute cases, such as that before us. One of the most important of these cases is
Marlin v. Aimco Venezia, LLC
(2007)
The Court of Appeal disagreed with the trial court that the SLAPP motion was appropriate and reversed its order. After quoting the key language from section 425.16, subdivision (a), the court wrote: “Even if we assume filing and serving the Ellis Act notice and the notice to vacate constituted protected petitioning or free speech activity ‘the 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.’ Rather, the critical question in a SLAPP motion ‘is whether the cause of action is based on the defendant’s protected free speech or petitioning activity.’ [][] Defendants have fallen victim to the logical fallacy post hoc ergo propter hoc—because the notices *951 preceded plaintiffs’ complaint the notices must have caused plaintiffs’ complaint. The filing and service of the notices may have triggered plaintiffs’ complaint and the notices may be evidence in support of plaintiffs’ complaint, but they were not the cause of plaintiffs’ complaint. Clearly, the cause of plaintiffs’ complaint was defendants’ allegedly wrongful reliance on the Ellis Act as their authority for terminating plaintiffs’ tenancy. Terminating a tenancy or removing a property from the rental market are not activities taken in furtherance of the constitutional rights of petition or free speech.” (Marlin, supra, 154 Cal.App.4th at pp. 160-161, fns. omitted.) 2
In January 2009, perhaps the most pertinent of the appellate decisions discussing the application (or lack thereof) of the SLAPP statute to landlord-tenant disputes was published. It is
Clark v. Mazgani
(2009)
Quoting Marlin, the Clark court continued: “ ‘Terminating a tenancy or removing a property from the rental market are not activities taken in furtherance of the constitutional rights of petition or free speech.’ [Citations.] ‘ “[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.] The pivotal question ‘ “is whether the cause of action is based on the defendant’s protected free speech or petitioning activity.” ’ [Citation.]” (Clark, supra, 170 Cal.App.4th at pp. 1286-1287, italics omitted.)
The
Clark
court then discussed the facts and rulings of both
Marlin
and
DFEH
and held: “The same reasoning applies here. Clark’s action against
*952
Mazgani is not based on Mazgani’s filing or service of the notices of intent to evict, it is not based on anything Mazgani said in court or a public proceeding, and it is not based on the fact that Mazgani prosecuted an unlawful detainer action against her. The complaint is based on Mazgani’s allegedly unlawful eviction, in that she fraudulently invoked the [rent ordinance] to evict Clark from her rent-controlled apartment as a ruse to provide housing for her daughter, but never installed her daughter in the apartment as required by that ordinance, and also that she failed to pay Clark’s relocation fee.”
(Clark, supra,
Because the landlord in
Clark
relied on our decision (quoted above) in
Feldman
and also on
Birkner v. Lam
(2007)
*953
The
Clark
court then summed up the critical distinction between the facts before it and those before us in
Feldman
and the court in
Birkner.
“The pivotal distinction between the circumstances in
Marlin
... on one hand, and
Birkner
and
Feldman
on the other, is whether an actual or contemplated unlawful detainer action by a landlord (unquestionably a protected petitioning activity) merely ‘preceded’ or ‘triggered’ the tenant’s lawsuit, or whether it was instead the ‘basis’ or ‘cause’ of that suit.”
(Clark, supra,
We believe the law just summarized mandates a reversal of the trial court’s order in this case. As noted above, that court held that the defendant-landlords “have met the first prong of Section 425.16” because “settlement agreements, being a part of the litigation process, are protected activity under CCP section 425.16” and that such includes “ ‘communications preparatory or in anticipation of bringing an action.’ ” But plaintiff’s action here did not challenge any “communications preparatory [to] or in anticipation of’ a lawsuit. Rather, it challenged defendants’ actions in allegedly breaching the Tenancy Termination Agreement the parties had entered into after plaintiff would not meet their new rental demands, demands allegedly made because of defendants’ desire to convert their property into condominiums. It was also based on the landlords’ failure to return plaintiff’s rental deposit and other promised refunds, because he was a “couple of days” late in moving out of his unit and had not left it “broom clean”—apparently because of material still in the unit belonging to the landlords, their contractor, and an earlier tenant.
Defendants themselves concede that essentially this was the case via the last two sentences of the “Statement of Facts” section of their opening brief, which reads: “Plaintiff expected the consideration due to him under the agreement if he performed. Instead, Defendants enforced their rights for Plaintiff’s breach.” Nothing in that summary of the factual background of plaintiff’s lawsuit suggests, even slightly, any “protected activity” by defendants.
*954 Because almost none of the cases noted above were cited or discussed in the parties’ original briefs to this court, 4 we asked for and received supplemental briefs from both. In their supplemental brief, defendants do not explicitly identify the “protected activity” they undertook prior to plaintiff’s lawsuit, but we deduce from some of the language in that brief that they contend it consisted of “enforcement of an agreement entered into to avoid litigation” or a “communication to avoid litigation.” But no case cited by them stands for the proposition that such does now, or ever has, constituted the requisite “protected activity.”
For example, defendants contend that
Blanchard
v.
DIRECTV, Inc.
(2004)
Defendants also cite
Navarro v. IHOP Properties, Inc.
(2005)
*955 In the present case, there was no litigation commenced by the defendant-landlords, not even an unlawful detainer action. The maximum they did to evict plaintiff was raise his rent and, when the two sides couldn’t agree on a new rental agreement, serve him with a three-day notice to quit. A few weeks later, that notice was effectively superseded by the Tenancy Termination Agreement. This case is, therefore, much more akin to Marlin and Clark, in both of which the appellate courts found no relevant prior litigation or threats of litigation by the landlord before the tenant’s lawsuit triggering the SLAPP motion. In our Feldman case, there was an unlawful detainer action filed by the landlords 6 and, in Birkner, both the service of a termination notice and the landlord’s refusal to rescind that notice after the tenants advised him that they constituted a “protected household.” (See Birkner, supra, 156 Cal.App.4th at pp. 283-284.)
Further, defendants’ contention that, because plaintiff’s lawsuit concerns a “settlement agreement” negotiated between the parties, a SLAPP motion is appropriate regarding an action alleging its breach is simply incorrect, as the Allied Business decision discussed above makes clear. In that case, the “settlement agreement” actually settled litigation-, here, it did not, but only resolved—or attempted to resolve—a landlord-tenant dispute over the amount of rent payable. If the first prong of section 425.16 was not satisfied in Applied Business, it surely is not here. Put another way; an unsuccessful attempt by landlords to settle a dispute with a tenant does not constitute “protected activity” under the first prong of section 425.16.
For all the reasons discussed above, we hold that defendants’ section 425.16 motion in the trial court did not, on the facts and pleadings of this case, satisfy the first prong of that statute and that, therefore, the trial court erred in granting it as to any of the causes of action in plaintiff’s complaint. We therefore deny defendants’ appeal and grant plaintiff’s cross-appeal and reverse the trial court’s order.
*956 IV. DISPOSITION
The order appealed from is reversed. Costs on appeal are awarded to plaintiff and appellant Delois.
Kline, P. J., and Richman, J., concurred.
Notes
However, in their opening brief to us, defendants concede that “[m]ost, but not all, of the material left behind had been put there by [defendants], their contractors, or the prior tenant. However, Plaintiff could have made an exception for this material in the settlement agreement, but did not.”
Other appellate decisions involving rental property disputes
not
triggering section 425.16 include
Santa Monica Rent Control Bd.
v.
Pearl Street, LLC
(2003)
Meaning, of course, that in the latter circumstance the first prong is satisfied, but not in the former. Interestingly, this wording was quoted in a recent secondary discussion of when landlord-tenant litigation triggers the first prong of the SLAPP statute and when it does not. (See Miller & Starr, Real Estate NewsAlert (May 2009) New Cases: Landlord and Tenant.) Also, and prior to Clark and its discussion regarding what is and what is not “protected activity” under section 425.16 in landlord-tenant disputes, a related secondary authority summed up some of the other authority discussed above thusly: “The boundary line between what is and what is not, within the scope of the anti-SLAPP statute is not always predictably clear, and the courts are required to analyze each fact situation with detailed attention to whether the conduct called into question by the special motion was in furtherance of the right of free speech or petition.” (7 Miller & Starr, Cal. Real Estate (3d ed. 2008-2009 Supp.) § 19:241, p. 21.)
Before oral argument, we cited many of these cases to counsel and suggested they be prepared to discuss them. At oral argument, counsel for defendants conceded that he was aware of those cases, but had opted not to discuss them in his briefs to us. We thus respectfully refer that counsel to this court’s comments on that subject in
Batt v. City and County of San Francisco
(2007)
Other than
Feldman
and
Birkner,
defendants cite no landlord-tenant dispute cases even arguably to the contrary. For example, cases such as
Dowling v. Zimmerman
(2001)
In
Feldman
we held that, because of (1) the previous unlawful detainer action filed by the landlord and (2) various “threatening comments” made by the landlord’s agent
(Feldman, supra,