Opinion
NOT TO BE PUBLISHED
APPEAL from a judgment of the Superior Court of Fresno County Super. Ct. No. 05CECG03796. Michael Bruce Smith, Judge.
Law Office of Joseph Uremovic, Joseph A. Uremovic for Plaintiffs and Appellants.
McCormick, Barstow, Sheppard, Wayte & Carruth, Lowell T. Carruth and William Littlewood, for Defendants and Respondents Trudi G. Manfredo and Deanna K. Hazelton.
The Law Firm of Powell & Pool, and Don J. Pool for Defendant and Respondent WestAmerica Bank.
OPINION
Ardaiz, P.J.
INTRODUCTION
Appellants Thomas L. Pigg and Betty J. Pigg appeal from the superior court’s grant of a motion to strike pursuant to Code of Civil Procedure section 425.16, also known as the anti-SLAPP statute. Appellants also appeal from the denial of their motion for a new trial. We affirm.
Unless stated otherwise, all further section citations are to the Code of Civil Procedure.
FACTUAL AND PROCEDURAL BACKGROUND
On December 5, 2005, plaintiffs filed a complaint in Fresno Superior Court against Trudi G. Manfredo, Deanna K. Hazelton, Thomas G. Hogan, and WestAmerica Bank. Manfredo and Hazelton were attorneys for WestAmerica Bank (WestAmerica). In the complaint, plaintiffs alleged that, in October 2004, they hired Hogan to protect a piece of real property against the claims of their creditor, WestAmerica. Hogan filed a voluntary Chapter 13 bankruptcy petition on their behalf. The purpose of the bankruptcy filing was to delay the sale of the real property by WestAmerica until plaintiffs could complete the sale of the real property on more favorable terms.
On February 1, 2005, plaintiffs received a written offer to sell the real property for $984,000. Prior to that date, WestAmerica, through its attorneys, Manfredo and Hazelton, filed a Motion for Relief of Stay, which if granted, would have allowed WestAmerica to sell the real property through a trustee’s sale.
The hearing on the Motion for Relief of Stay was held on February 10, 2005. Hogan failed to appear, but Thomas Pigg did appear. The motion was granted. According to plaintiffs, after “the February 10, 2005, hearing on defendant WESTAMERICA’s Motion for Relief of Stay, plaintiff Thomas L. Pigg asked to speak with defendant HAZELTON. At the time defendant Hazelton knew that the plaintiffs were represented by defendant HOGAN, but none-the-less carried on a conversation with plaintiff Thomas L. Pigg. The substance of the conversation was that defendant HAZELTON indicated that defendant WESTAMERICA would give the plaintiffs several options to deal with the debt owe[d] to said defendant, including, allowing the plaintiffs to sell the property and pay off the bank, refinance the property with another lender or otherwise keep the property from being sold at a trustee’s sale. Defendant HAZELTON said absolutely nothing to cause plaintiff THOMAS L. PIGG to think that there would be a trustee’s sale of his real property without further notice to him.”
Plaintiffs further alleged that: “Without notice of any sort to the plaintiffs, on March 28, 2005, defendant WESTAMERICA caused a trustee’s sale to be conducted by which the [real property] owned by the plaintiffs was sold for $201,000.00. The value of the property at the time was $984,000.00.”
As a result of the conversation with Hazelton and the subsequent trustee’s sale, plaintiffs alleged causes of actions for negligence and intentional misrepresentation. Plaintiffs sought general damages in the amount of $783,000, which was the difference between the proceeds at the trustee’s sale and the written offer to sell the property, as well as punitive damages, attorney’s fees and costs.
Defendant WestAmerica filed a cross-complaint for indemnity against Manfredo and Hazelton. WestAmerica also filed a demurrer to the complaint, contending that plaintiffs pleading allegations did not allege facts for each element of the causes of action for negligence and intentional misrepresentation. Plaintiffs filed an opposition to the demurrer.
Defendants Manfredo and Hazelton moved to strike any claim for punitive damages. They argued that plaintiffs did not sufficiently plead oppression, malice or fraud given that the fraud claim was barred by the litigation privilege of Civil Code section 47, subdivision (b).
Plaintiffs opposed the motion to strike punitive damages, arguing that the fraud claim was sufficient to satisfy the requirements for punitive damages given that plaintiffs were suing defendants for what Hazelton did to plaintiffs, and not for what Hazelton said to plaintiffs.
In reply, Manfredo and Hazelton argued that the statements allegedly made by Hazelton during a bankruptcy proceeding were protected by Civil Code section 47, subdivision (b).
Manfredo and Hazelton also filed a motion to strike the complaint pursuant to the anti-SLAPP statute and asked for attorney’s fees and costs. In their memorandum of points and authority in support of the motion, Manfredo and Hazelton argued that the complaint should be dismissed because the communications forming the basis of the complaint were protected under the litigation privilege of Civil Code section 47, subdivision (b) and under the anti-SLAPP statute. Hazelton also denied having any conversation with Thomas Pigg as described in the complaint. WestAmerica joined in this motion.
Plaintiffs opposed the motion to strike the complaint pursuant to the anti-SLAPP statute. They argued that it was not the words that were said by Hazelton which caused them damage, but the failure to provide them with information about the true intentions of WestAmerica with respect to the sale of the real property.
In their reply, defendants contended that plaintiffs were trying to change their theory of damage from the theory they were damaged by the statements made by Hazelton to the new theory that they were damaged by the sale of the property. In any case, according to defendants, the trustee’s sale of the real property was so inextricably intertwined with the alleged statements and omissions that, even under the new theory, the damages arose out of the protected activity by Hazelton.
After a hearing on these motions, on April 3, 2006, the superior court granted the motion to strike pursuant to the anti-SLAPP statute and awarded attorney’s fees and costs. The court ruled that the other motions were rendered moot. The superior court ruled that defendants had made a threshold showing that their statements were protected activity under section 425.16. The court also concluded that plaintiffs failed to establish a probability of prevailing on their claim because defendants’ communications were protected by Civil Code section 47, subdivision (b).
On May 1, 2006, plaintiffs filed a Motion for a New Trial. They argued that the superior court erred in granting the motion to strike because they were suing for what defendants did and not what they said. On June 29, 2006, the motion was denied. On July 10, 2006, plaintiffs appealed the denial of the motion for a new trial and the underlying judgment.
DISCUSSION
I.
STANDARD OF REVIEW
An order granting an anti-SLAPP motion is reviewed de novo. (Carver v. Bonds (2005) 135 Cal.App.4th 328, 342; Kashian v. Harriman (2002) 98 Cal.App.4th 892, 906 (Kashian).) As a general matter, orders denying a motion for a new trial are examined for abuse of discretion. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 829.) However, where the determination involves an underlying motion, the standard of review is that which is appropriate for the underlying motion. (Id. at pp. 869-870.)
II.
Anti-SLAAP Motion
Section 425.16 provides, in pertinent part:
“(b)(1) A cause of action against a person arising from any act of that person in furtherance of the person’s right of petition or free speech under the United States or California Constitution in connection with a public issue shall be subject to a special motion to strike, unless the court determines that the plaintiff has established that there is a probability that the plaintiff will prevail on the claim.
“(b)(2) In making its determination, the court shall consider the pleadings, and supporting and opposing affidavits stating the facts upon which the liability or defense is based.”
Section 425.16 specially defines “acts in furtherance of a person’s right of petition or free speech under the United States or California Constitution in connection with a public issue” to include, among others, “any written or oral statement or writing made before a legislative, executive, or judicial proceeding, or any other official proceeding authorized by law” and “any written or oral statement or writing made in connection with an issue under consideration or review by a legislative, executive, or judicial body, or any other official proceeding authorized by law.” (§ 425.16, subds. (e)(1) & (e)(2).)
In interpreting these provisions, we must construe the provisions broadly in order to protect the right to petition and free speech. (§ 425.16, subd. (a); Briggs v. Eden Council for Hope and Opportunity (1999) 19 Cal.4th 1106, 1109 & 1123 (Briggs).)
Section 425.16 “requires the court to engage in a two-step process. First, the court decides whether the defendant has made a threshold showing that the challenged cause of action is one arising from protected activity. The moving defendant’s burden is to demonstrate that the act or acts of which the plaintiff complains were taken ‘in furtherance of the [defendant]’s right of petition or free speech under the United States or California Constitution in connection with a public issue,’ as defined in the statute. (§ 425.16, subd. (b)(1).) If the court finds such a showing has been made, it then determines whether the plaintiff has demonstrated a probability of prevailing on the claim.’” (Equilon Enterprises v. Consumer Cause, Inc. (2002) 29 Cal.4th 53, 67 (Equilon).)
Civil Code section 47, subdivision (b), if applicable, can assist the court at both steps of the process. First, Civil Code section 47, subdivision (b) may be considered “as an aid” in determining whether a communication falls within the ambit of section 425.16, subdivisions (e)(1) and (e)(2), although the scope of protection afforded by Civil Code section 47, subdivision (b) is not identical to that granted by section 425.16. (Flatley v. Mauro (2006) 39 Cal.4th 299, 322.) Civil Code section 47, subdivision (b) establishes an absolute privilege for statements made “[i]n any (1) legislative proceeding, (2) judicial proceeding, (3) in any other official proceeding authorized by law, or (4) in the initiation or course of any other proceeding authorized by law .…” Second, Civil Code section 47, subdivision (b), if applicable, is relevant to whether plaintiffs can show a probability of success on the merits because it is a substantive defense that plaintiffs must overcome. (See Flatley v. Mauro, supra, 39 Cal.4th at p. 323.) Under Civil Code section 47, subdivision (b), any communications logically related to litigation is absolutely protected (except from the tort of malicious prosecution) even if the communications are, or are alleged to be, fraudulent, perjurious, unethical, or even illegal. (Kashian, supra, 98 Cal.App.4th at p. 920.)
Here, respondents have made a threshold showing that the complaint should be dismissed under section 425.16. The complaint alleges that plaintiffs were damaged by the alleged failure of Hazelton to inform them that WestAmerica would pursue a trustee’s sale of the real property. The issue of the disposition of assets of a bankrupt by creditors was an issue under consideration and review by the federal bankruptcy court. Thus, Hazelton’s alleged communications with Thomas Pigg were statements made in connection with an issue under consideration or review by a judicial proceeding.
On appeal, plaintiffs contend that Hazelton’s statements were not made before, or in connection with an issue under consideration or review by, the federal bankruptcy court. Rather, the statements were made after the federal bankruptcy court had already granted the Motion for Relief of the Stay. We disagree. The issue of the disposition of the assets of a bankrupt, especially where the bankruptcy case has not been closed, is an issue that is of continuing interest to the federal bankruptcy court, and thus an issue under continuing review by the court.
Plaintiffs also argue that there was no communicative act. They assert that they are suing for Hazelton’s act of failing to inform them about WestAmerica’s true intentions with respect to the real property, and not for the words that were actually spoken by Hazelton. We disagree that there was no communicative act. Plaintiffs allege that they were damaged because they relied upon affirmative representations by Hazelton that WestAmerica would provide them with alternatives to address their debt to WestAmerica. From the pleadings, we can infer that plaintiffs understood Hazelton’s representations and omissions to also mean that WestAmerica would not pursue a trustee’s sale until plaintiffs had utilized some or all of these alternatives. Thus, the failure to inform plaintiffs was a communicative act because that failure communicated to plaintiffs that they did not have to worry about WestAmerica conducting a trustee’s sale until plaintiffs were afforded an opportunity to explore alternative methods of addressing their debt to WestAmerica.
We also conclude that plaintiffs have failed to meet their burden of demonstrating a probability of prevailing on their claim against respondents given that the alleged statements and omissions by Hazelton are absolutely protected from their causes of action by Civil Code section 47, subdivision (b).
The alleged representations or omissions of Hazelton are statements made in the course of a judicial proceeding. They are logically connected to the bankruptcy case that was then pending before the federal bankruptcy court. Essentially, based upon the alleged misrepresentation or omission of Hazelton, plaintiffs believed that, even though WestAmerica could go forward with the trustee’s sale, WestAmerica would not go forward with it without specifically informing them. Thus, the alleged representations or omissions are absolutely protected from plaintiffs’ causes of action for negligence and for fraud by the litigation privilege of Civil Code section 47, subdivision (b). (Cf. Pollock v. Superior Court (1991) 229 Cal.App.3d 26, 28-29 [applying the litigation privilege and stating: “Simply put, the public policy of this state is not served by permitting attorneys to sue one another for omissions or representations made as officers of the court during the course of litigation.”].)
Plaintiffs provided no admissible evidence that would refute any of the foregoing discussion and analysis. Thus, we conclude that the superior court did not err in granting the motion to strike pursuant to section 425.16 and awarding attorney’s fees and costs.
III.
Denial of Motion for A New Trial
Section 657 provides that any decision of the court “may be modified or vacated, in whole or in part, and a new or further trial granted on all or part of the issues, on the application of the party aggrieved, for any of the following causes, materially affecting the substantial rights of such party:
“1. Irregularity in the proceedings of the court, jury or adverse party, or any order of the court or abuse of discretion by which either party was prevented from having a fair trial. [¶] … [¶]
“6. Insufficiency of the evidence to justify the verdict or other decision, or the verdict or other decision is against law.
“7. Error in law, occurring at the trial and excepted to by the party making the application.”
On appeal, in their opening brief, plaintiffs did not present any argument on why the superior court erred in denying their motion for a new trial. In their reply brief and in their motion for a new trial below, plaintiffs assert that the superior court erred in denying their motion for a new trial because the court erred in reaching its conclusions on section 425.16. We have previously concluded that the superior court did not err in analyzing the case under section 425.16. Thus, we conclude that the superior court did not err in denying the motion for a new trial.
DISPOSITION
The judgment is affirmed. Respondents shall recover their costs and reasonable attorney’s fees on appeal, the amount of which shall be determined upon proper application to the superior court.
WE CONCUR: Vartabedian, J., Harris, J.