Opinion
NOT TO BE PUBLISHED
APPEAL from an order of the Superior Court of Los Angeles County No. LC084441 Paul Gutman, Judge.
Leo A. Schwarz for Defendant and Appellant.
Neil C. Newson & Associates and Isaac H. Braddock for Plaintiff and Respondent.
KLEIN, P. J.
Defendant and appellant Dennis P. Block individually and dba Dennis P. Block & Associates (Block) appeals an order denying his special motion to strike a malicious prosecution complaint filed by plaintiff and respondent Diana Nunez (Nunez). (Code Civ. Proc., § 425.16.)
An order denying a special motion to strike is appealable. (§ 425.16, subd. (i).)
We conclude Attorney Block had probable cause to initiate and to prosecute the underlying unlawful detainer complaint against Nunez on behalf Nunez’s landlord. Therefore, Nunez is incapable of prevailing in her action against Block for malicious prosecution. Accordingly, the trial court erred in denying Block’s special motion to strike. The order denying the special motion to strike is reversed with directions to grant the relief requested.
FACTUAL AND PROCEDURAL BACKGROUND
1. Events preceding the malicious prosecution action.
Nunez was a tenant of landlord Marilyn Isaacson (Isaacson) in an apartment building on Sherman Way in Canoga Park. The tenancy was pursuant to a Section 8 contract between Isaacson and the Housing Authority of the City of Los Angeles (Housing Authority).
Our decision in Apartment Assn. of Los Angeles County, Inc. v. City of Los Angeles (2006) 136 Cal.App.4th 119 (Apartment Assn.) contains an overview of the Section 8 program, to wit: “The housing assistance program commonly known as Section 8 is funded by the United States Department of Housing and Urban Development (HUD) to provide rental assistance to senior citizens, disabled or handicapped persons and very low income tenants. HUD channels money to housing authorities, provides technical assistance and training, and monitors housing authority compliance with program requirements and goals. Rather than being provided with a specific unit at a subsidized housing site, Section 8 participant-tenants receive vouchers to contract for housing with participating landlords. Locally, Section 8 is administered by the Housing Authority of the City of Los Angeles (Housing Authority). [¶] Because the need for Section 8 vouchers greatly exceeds their availability, applicants are assigned to a waiting list. When an eligible applicant reaches the top of the waiting list, the applicant receives a voucher. The voucher assists the applicant in renting a privately owned dwelling. The dwelling the applicant chooses must meet Section 8 housing quality standards and the owner of the dwelling must agree to abide by HUD/Section 8 regulations. Section 8 tenants pay about 30 percent of their income towards their rent and HUD, via the Housing Authority, pays the rest of the rent to the owner. [¶] The Section 8 tenant finds housing much like anyone else. The Section 8 tenant must pay a portion of the rent, adhere to the lease and HUD’s Lease Addendum requirements, and cooperate with the Housing Authority in annual inspections and income and rent reviews. [¶] The Section 8 owner functions as a landlord in the private rental market. The owner signs a lease with the Section 8 tenant (which includes a HUD Lease/Tenancy Addendum) and also signs a housing assistance payments (HAP) contract with the Housing Authority. Pursuant to the HAP contract, the Housing Authority makes housing assistance payments to the Section 8 owner.” (Apartment Assn., supra, 136 Cal.App.4th at pp. 122-123, italics added.)
On August 22, 2007, the Housing Authority notified Nunez in writing that her participation in the Section 8 program would be terminated effective September 22, 2007, for Nunez’s failure to provide access for the annual inspection. The August 22, 2007 letter noted “You were advised in two previous letters of your responsibility to provide access to your unit for Annual Inspection.” The August 22, 2007 letter also included a notification to Isaacson that the Section 8 contract with the owner would be terminated on September 30, 2007.
As of October 11, 2007, the October rent of $900 had not been paid. On that date, Isaacson served Nunez with a three-day notice to pay rent or quit the premises.
On October 24, 2007, Isaacson, represented by Block, filed an unlawful detainer complaint against Nunez.
Although Isaacson had filed two previous unlawful detainer actions against Nunez, the October 24, 2007 filing was the only matter in which Block represented Isaacson.
On November 6, 2007, the Housing Authority notified Isaacson that it had learned Nunez had been hospitalized, and that “We reinstated this contract on October 11, 2007.” The letter added that checks in the amount of $690 “were issued on 9/1, 10/12 and 11/1/07.”
Isaacson did not cash the checks and Block continued to prosecute the unlawful detainer action, on the ground a landlord is not required to accept either a partial payment of rent prior to the expiration of the three-day period, nor is a landlord required to accept any payment tendered after the expiration of such period.
The unlawful detainer action was resolved in favor of Nunez. The trial court ruled Nunez could not be evicted based on the mistaken termination of her Section 8 benefits.
2. The instant malicious prosecution action.
On February 17, 2009, Nunez filed suit against Block for malicious prosecution arising out of the underlying unlawful detainer action. Nunez pled she obtained a favorable termination of the underlying action, no reasonable attorney in Block’s circumstances would have believed there were reasonable grounds for bringing the suit, and that Block acted in conscious disregard of her rights, warranting the imposition of punitive damages.
On March 26, 2009, Block filed a special motion to strike, on the ground the malicious prosecution action was subject to a special motion to strike, and Nunez could not establish a probability of prevailing on her claim.
In opposition, Nunez asserted the malicious prosecution was meritorious because she had prevailed in the underlying unlawful detainer action and that Block lacked probable cause to bring the unlawful detainer action. Nunez asserted Block was pursuing “a legal theory untenable in the case of a Section 8 tenant who had been briefly and erroneously suspended by the Section 8 program....”
The record reflects Nunez’s participation in the Section 8 program was not merely “suspended.” The August 22, 2007 notice from the Housing Authority unambiguously terminated Nunez’s assistance and participation in the Section 8 program, effective September 22, 2007.
On April 27, 2009, the matter came on for hearing. The trial court denied Block’s special motion to strike, ruling “the unlawful detainer action was not objectively legally tenable at the time of filing, ” in that “[a]ccording to a November 6, 2007 letter from the [Housing Authority], Nunez’s Section 8 benefits were reinstated on October 11, 2007.”
Block filed a timely notice of appeal from the order denying his special motion to strike.
CONTENTIONS
Block contends: a special motion to strike is permissible in defense of a claim of malicious prosecution stemming from the filing and prosecution of an unlawful detainer action; it was reasonable for Block to believe a court might agree with him the Housing Authority’s purported retroactive reinstatement of the Section 8 contract did not render the third unlawful detainer action moot; Nunez’s contentions regarding the effect of the federal regulations, the nonpayment of rent, and Block’s alleged discovery tactics, lack merit; and Nunez failed to establish malice on Block’s part.
DISCUSSION
1. General principles re a special motion to strike.
As the Supreme Court recently reiterated in Simpson Strong-Tie Co., Inc. v. Gore (2010) 49 Cal.4th 12 (Simpson), a Strategic Lawsuit Against Public Participation, or SLAPP, “is a civil lawsuit that is aimed at preventing citizens from exercising their political rights or punishing those who have done so. ‘ “While SLAPP suits masquerade as ordinary lawsuits such as defamation and interference with prospective economic advantage, they are generally meritless suits brought primarily to chill the exercise of free speech or petition rights by the threat of severe economic sanctions against the defendant, and not to vindicate a legally cognizable right.” ’ (Castillo v. Pacheco (2007) 150 Cal.App.4th 242, 249-250 [58 Cal.Rptr.3d 305], quoting Sen. Com. on Judiciary, Analysis of Sen. Bill No. 1296 (1997-1998 Reg. Sess.) as amended May 12, 1997, pp. 1-2.)” (Simpson, supra, 49 Cal.4th at p. 21.)
In 1992, “out of concern over ‘a disturbing increase’ in these types of lawsuits, the Legislature enacted section 425.16, the anti-SLAPP statute. (§ 425.16, subd. (a).) The statute authorized the filing of a special motion to strike to expedite the early dismissal of these unmeritorious claims. (§ 425.16, subds. (b)(1), (f).) To encourage ‘continued participation in matters of public significance’ and to ensure ‘that this participation should not be chilled through abuse of the judicial process, ’ the Legislature expressly provided that the anti-SLAPP statute ‘shall be construed broadly.’ (§ 425.16, subd. (a).)” (Simpson, supra, 49 Cal.4th at p. 21.)
A special motion to strike “involves a two-step process. First, the defendant must make a prima facie showing that the plaintiff’s ‘cause of action... aris[es] from’ an act by the defendant ‘in furtherance of the [defendant’s] right of petition or free speech... in connection with a public issue.’ [Fn. omitted.] (§ 425.16, subd. (b)(1).) If a defendant meets this threshold showing, the cause of action shall be stricken unless the plaintiff can establish ‘a probability that the plaintiff will prevail on the claim.’ ” (Simpson, supra, 49 Cal.4th at p.21.)
Review “of an order granting or denying a motion to strike under section 425.16 is de novo. [Citation.] We consider ‘the pleadings, and supporting and opposing affidavits... upon which the liability or defense is based.’ (§ 425.16, subd. (b)(2).) 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.]” (Soukup v. Law Offices of Herbert Hafif (2006) 39 Cal.4th 260, 269, fn. 3.)
2. The tort of malicious prosecution.
In order “to establish a cause of action for malicious prosecution of either a criminal or civil proceeding, a plaintiff must demonstrate ‘that the prior action (1) was commenced by or at the direction of the defendant and was pursued to a legal termination in his, plaintiff’s, favor [citations]; (2) was brought without probable cause [citations]; and (3) was initiated with malice [citations].’ ” (Sheldon Appel Co. v. Albert & Oliker (1989) 47 Cal.3d 863, 871 (Sheldon Appel).)
In a malicious prosecution action, the existence of probable cause for the underlying claim is always a question of law for the court to decide. (Sheldon Appel, supra, 47 Cal.3d at pp. 875-876; Downey Venture v. LMI Ins. Co. (1998) 66 Cal.App.4th 478, 496.)
Although probable cause is a question of law, “it is sometimes necessary to submit preliminary factual questions to the jury when there is a dispute as to facts which the defendant knew when he instituted the prior action....” (Sheldon Appel, supra, 47 Cal.3d at p. 884.)
As discussed in Wilson v. Parker, Covert & Chidester (2002) 28 Cal.4th 811 (Wilson), the Supreme Court “addressed the probable cause element of malicious prosecution comprehensively in Sheldon Appel, supra, 47 Cal.3d 863. [It] first considered the policy reasons for adhering to limitations on the malicious prosecution tort, reiterating that the tort is disfavored both because of its ‘potential to impose an undue “chilling effect” on the ordinary citizen’s willingness to report criminal conduct or to bring a civil dispute to court’ [citation] and because, as a means of deterring excessive and frivolous lawsuits, it has the disadvantage of constituting a new round of litigation itself [citation].” (Wilson, supra, 28 Cal.4th at pp. 816-817.)
“Applying that policy perspective to the delineation of the probable cause element, [Sheldon Appel] held, first, that the existence or nonexistence of probable cause is a legal question to be resolved by the court in the malicious prosecution case; litigants are thus protected against the danger that a lay jury would mistake a merely unsuccessful claim for a legally untenable one. (Sheldon Appel, supra, 47 Cal.3d at pp. 874-877.) [Sheldon Appel] further held that probable cause is determined objectively, i.e., without reference to whether the attorney bringing the prior action believed the case was tenable (id. at pp. 877-882), and that the standard of probable cause to bring a civil suit was equivalent to that for determining the frivolousness of an appeal (In re Marriage of Flaherty (1982) 31 Cal.3d 637), i.e., probable cause exists if ‘any reasonable attorney would have thought the claim tenable.’ (Sheldon Appel, supra, at p. 886.) This rather lenient standard for bringing a civil action reflects ‘the important public policy of avoiding the chilling of novel or debatable legal claims.’ (Id. at p. 885.) Attorneys and litigants... ‘ “have a right to present issues that are arguably correct, even if it is extremely unlikely that they will win....” ’ (Ibid., quoting In re Marriage of Flaherty, supra, at p. 650.) Only those actions that ‘ “any reasonable attorney would agree [are] totally and completely without merit” ’ may form the basis for a malicious prosecution suit. (Ibid.)” (Wilson, supra, 28 Cal.4th at p. 817, italics added.)
Malicious prosecution “includes continuing to prosecute a lawsuit discovered to lack probable cause.” (Zamos v. Stroud (2004) 32 Cal.4th 958, 973, italics added.) Therefore, “an attorney may be held liable for malicious prosecution when he commences a lawsuit properly but then continues to prosecute it after learning it is not supported by probable cause.” (Id. at p. 960.)
Further, an attorney is entitled to rely on a client’s representations. (Swat-Fame, Inc. v. Goldstein (2002) 101 Cal.App.4th 613, 618, disapproved on other grounds in Zamos v. Stroud, supra, 32 Cal.4th at p. 973.) “Plaintiffs and their attorneys are not required, on penalty of tort liability, to attempt to predict how a trier of fact will weigh the competing evidence, or to abandon their claim if they think it likely the evidence will ultimately weigh against them. They have the right to bring a claim they think unlikely to succeed, so long as it is arguably meritorious.” (Wilson, supra, 28 Cal.4th at p. 822.)
3. Trial court erred in denying special motion to strike.
a. Block met his burden to show the cause of action for malicious prosecution arose from protected activity in bringing the unlawful detainer action.
Block had the initial burden, as a defendant bringing a special motion to strike, to make a prima facie showing that Nunez’s cause of action for malicious prosecution arose from Block’s protected activity in bringing the unlawful detainer action. (Simpson, supra, 49 Cal.4th at p. 21.)
The “prosecution of an unlawful detainer action indisputably is protected activity within the meaning of section 425.16.” (Birkner v. Lam (2007) 156 Cal.App.4th 275, 281.) Thus, Block met his threshold burden.
The burden then shifted to Nunez to establish a probability she would prevail on her claim. (Simpson, supra, 49 Cal.4th at p. 21.)
b. Nunez failed to meet her burden to show Block lacked probable cause to initiate and to prosecute the unlawful detainer action.
As indicated, on August 22, 2007, the Housing Authority notified Isaacson the Section 8 contract with the landlord would be terminated on September 30, 2007. Thus, on the date the unlawful detainer action was commenced, i.e., October 24, 2007, there was no Section 8 relationship among the parties, so that Nunez was solely responsible for the entire monthly rent of $900.00.
On November 6, 2007, the Housing Authority notified Isaacson it had “reinstated” the Section 8 contract on October 11, 2007. The general rule is that the nullification of a repudiation of a contract will be given effect “ ‘if the injured party disregards the repudiation and treats the contract as still in force, and the repudiation is retracted prior to the time of performance....’ ” (Central Valley General Hospital v. Smith (2008) 162 Cal.App.4th 501, 517.) This raises an issue as to whether the Housing Authority, after having terminated the contact with Isaacson, had the power to unilaterally “reinstate” the contract with the landlord, and to do so retroactively.
To reiterate, Nunez had the burden, in resisting the special motion to strike, to show Block’s commencement and continued prosecution of the unlawful detainer action was not legally tenable. Nunez failed to show Isaacson was compelled to recognize the purported reinstatement of the Section 8 contract, so as to make the unlawful detainer action essentially frivolous.
Nunez does not dispute Block’s assertion that there is no federal HUD regulation requiring a landlord to be bound by a purported reinstatement of a previously terminated Section 8 contract.
c. Nunez was not entitled to 90 days notice to quit the premises.
Nunez contends that because this was a Section 8 tenancy, Block was obligated to proceed pursuant to Civil Code section 1954.535. That section provides: “Where an owner terminates or fails to renew a contract or recorded agreement with a governmental agency that provides for rent limitations to a qualified tenant, the tenant or tenants who were the beneficiaries of the contract or recorded agreement shall be given at least 90 days’ written notice of the effective date of the termination and shall not be obligated to pay more than the tenant’s portion of the rent, as calculated under the contract or recorded agreement to be terminated, for 90 days following receipt of the notice of termination of nonrenewal of the contract.” (Civ. Code, § 1954.535, italics added.)
The statute, by its terms, is inapplicable. Civil Code section 1954.535, requiring 90 days notice, applies when “an owner terminates or fails to renew” a Section 8 contract. Here, it was the Housing Authority which terminated the Section 8 contract, effective September 30, 2007. Therefore, Block was not required to provide Nunez with a 90-day notice to quit.
4. Remaining issues not reached.
“If the court determines that there was probable cause to institute the prior action, the malicious prosecution action fails, whether or not there is evidence that the prior suit was maliciously motivated.” (Sheldon Appel, supra, 47 Cal.3d at p. 875.) Because Block had probable cause to initiate and to maintain the underlying unlawful detainer action on Isaacson’s behalf, Nunez is incapable of prevailing in her action against Block for malicious prosecution. Therefore, it is unnecessary to address whether Block acted with malice, or any other issues.
DISPOSITION
The order denying Block’s special motion to strike is reversed and the matter is remanded with directions to grant the motion. No costs are awarded.
We concur: CROSKEY, J., ALDRICH, J.
All further statutory references are to the Code of Civil Procedure, unless otherwise specified.