Tesoro del Valle Master HOA v. Griffen
November 2011
COUNSEL
Law Offices of Michael L. McQueen and Michael L. McQueen for Defendants and Appellants.
Greenberg Glusker Fields Claman & Machtinger and Ricardo P. Cestero for Plaintiff and Respondent.
OPINION
DOI TODD, Acting P. J.
Defendants and appellants Martin and Carolyn Griffin appeal from a
judgment following a jury verdict in favor of plaintiff and respondent
Tesoro del Valle Master Homeowners Association (Tesoro) on its claims
that appellants installed a solar energy system at their residence in
contravention of conditions, covenants and restrictions governing their
property. Unmindful of applicable standards of review, appellants raise a
host of issues in an effort to undermine the jury verdict. We affirm.
The jury properly determined the disputed issues and substantial
evidence supported the determinations; Tesoro properly evaluated
appellants' application for their system, brought suit and received a
jury trial; and the trial court properly exercised its discretion in the
admission and exclusion of expert testimony.
FACTUAL AND PROCEDURAL BACKGROUND
Tesoro's Governing Documents.Tesoro is a nonprofit mutual benefit corporation that manages,
administers, maintains, preserves and operates the residences and common
areas in the Tesoro community. On May 29, 2003, the developer of the
Tesoro community recorded with the Los Angeles County Recorder's Office a
Master Declaration of Establishment of Covenants, Conditions, and
Restrictions for Tesoro del Valle (CC&R's). The purpose of the
CC&R's is to enhance and protect the value, desirability and
attractiveness of the Tesoro community, as well as to give the Tesoro
Board of Directors (Tesoro Board) the authority to maintain community
standards.
Article 7 of the CC&R's addresses the duties and responsibilities
of Tesoro's volunteer Architectural Control Committee (ACC), providing
that homeowners must obtain the ACC's approval before making any
improvements to their property. Section 7.2 of the CC&R's outlines
the application process, providing the application requirements and
stating that the ACC may grant approval only if the applicant has
complied with those requirements and the ACC, in its discretion,
concludes that the proposed improvement conforms to the CC&R's and
is harmonious with the existing development.
Section 8.1.18 of the CC&R's reiterates that "[t]here shall be no
construction, alteration, or removal of any Improvement in the Project
(other than repairs or rebuilding done by the Association pursuant
hereto) without the approval of the Architectural Control Committee."
Further, section 8.1.20 of the CC&R's states: "Within slope areas,
no structure, planting, fencing, . . . shall be placed or permitted to
remain or other activities undertaken which may damage or interfere with
established slope ratios, create erosion or sliding problems, or which
may change the direction of flow of drainage channels or obstruct or
retard the flow of water through drainage channels." That provision also
imposes on the homeowner the duty to maintain the landscaping installed
on the slope by Tesoro.
In December 2003, Tesoro approved Design Guidelines to "help assure
continuity in design, which will help preserve and improve the
appearance of the community." Section III, paragraph G, specifically
directed to the architectural standards for solar energy systems,
provides: "As provided for in Section 714 of the California Civil Code,
reasonable restrictions on the installation of solar energy systems that
do not significantly increase the cost of the system or significantly
decrease its efficiency or specified performance, or which allow for an
alternative system of comparable costs, efficiency, and energy
conservation benefits may be imposed by the Committee [ACC]. [¶]
Whenever approval is required for the installation or use of a solar
energy system, the application for approval shall be processed and
approved by the Committee in the same manner as an application for
approval of a modification to the property, and shall not be willfully
avoided or delayed."
Appellants' Solar Energy System Installation.In 2005, appellants purchased their home at 29313 Hacienda Ranch Court (property) in the Tesoro development.[1]
Their corner property was approximately 15,000 square feet and included
a slope outside the perimeter wall. They were provided with a copy of
the CC&R's at that time and understood they would be bound by them.
They also received Tesoro's Design Guidelines and agreed to be bound by
those as well. Appellants were aware that they were required to maintain
their property, including the slope, and to submit a written
application to obtain approval from the ACC before making any
improvements to their property. After submitting the required
applications, they made several improvements to their property, such as
the installation of a pool, casita and landscaping including a fountain
and hardscape.
In 2007, appellants met with Joe Hawley, then with Advanced Solar
Electric, who gave them a proposal for the installation of a solar
energy system for their property. They told Hawley they were interested
in the system being installed on the slope adjacent to their residence.
Appellants submitted an application to install a solar energy system on
October 2, 2007.[2]
Euclid Management Company was responsible for Tesoro's day-to-day
management. When Martin walked the application into the Euclid
Management office, association manager Patty Prime told him it was not
likely to be approved. She informed him that the application was
incomplete in several areas and that she was unaware of any other solar
energy systems being installed outside a perimeter wall. According to
the CC&R's, the ACC had 45 days from the submission of appellants'
application to review and rule on it.
The CC&R's and Design Guidelines specify the application
requirements, which include the submission of a plot plan drawn to
scale, a detailed description of the proposed materials, a landscape
plan and a drainage plan. Appellants' application met none of the
requirements. It contained only a handwritten drawing with a rectangle
signifying the approximate location of the proposed solar panels. It did
not contain information concerning the panels' dimensions, number or
color; the setback; the proposed alterations to the landscaping; or the
amount of electricity proposed to be generated.
Because of Prime's negative comment, while their application was
pending appellants sought a proposal from Hawley for the installation of
solar panels on the roof of their residence. They received a proposal
on October 10, 2007, which provided for the installation of 36 solar
panels on their roof and 22 panels on the slope, but they did not amend
their pending application or submit a revised application to reflect the
changes. Instead, on November 8, 2007, they signed a $97,000 contract
with Advanced Solar Electric for the installation of the new proposed
solar energy system.
Also on November 8, 2007—before the expiration of the 45-day time limit—the ACC issued a letter denying appellants' application.[3]
The denial letter was misaddressed, however, and appellants did not
receive it until November 17, 2007—46 days after October 2, 2007.
Summarizing the ACC's position, Tim Collins handwrote four comments on
appellants' application noting that the roof of the casita adjacent to
appellants' residence should be considered as a location for the panels;
that the project's dimensions and minimum setbacks needed to be
provided on the site plan; that appellants needed to indicate how the
slope beneath the solar panels would be maintained; and that they needed
to submit photographs of the existing landscape and superimpose the
proposed panel elevation. The ACC was concerned about the proposed
slope-mounted system because it was at the entry to the neighborhood,
adjacent homes had a direct line of sight, the CC&R's prohibited
slope alteration and any alteration or landscape removal could impact
drainage. The ACC expected that appellants would address the expressed
concerns and submit a revised application.
After receiving the denial letter, Martin attended and spoke at a
meeting of the Tesoro Board, informing the board members that he deemed
the untimely denial of his project an approval, he had engaged a solar
contractor and he intended to proceed with his project starting in
January 2008. Hawley also tried to respond to the ACC's concerns. The
ACC, however, saw no indication that appellants had investigated
installation of the solar panels on the casita roof or that they had
made efforts to comply with the ACC's other requests. The Tesoro Board
also directed Prime to prepare a timeline of events concerning
appellants' application, and after review concluded that all applicable
time limits had been satisfied.
On December 18, 2007, appellants received a letter from Tesoro's
attorney, Jeffrey Beaumont, instructing them to stop further efforts to
install a solar energy system on their property. Beaumont wrote to
appellants again during the first week of January 2008, instructing them
to stop construction.
Nonetheless, appellants proceeded with the installation of a solar
energy system in January 2008. The system involved installing solar
panels on the roof, and, in preparation for additional panels to be
installed on the slope, removing landscaping and pouring a concrete
foundation for pylons. Ultimately, by mid-January 2008, appellants
agreed to stop construction temporarily pending Tesoro's request for
additional information. Following a January 23, 2008 meeting between
appellants, Hawley, and Tesoro and Euclid Management representatives,
appellants agreed to submit a revised application and Tesoro agreed to
review and rule on the application within one week. The supplemental
application added the installation of solar panels on the roof.
On January 29, 2008, the ACC denied the supplemental application in
part, specifically disapproving the installation of solar panels on the
slope and directing appellants to return the slope to its original
condition. The ACC remained concerned about the same issues that led to
the denial of the initial application, including that appellants had not
considered alternative locations. After receiving this letter,
appellants directed their contractor to complete the installation of
solar panels on the slope. The system was fully installed by the end of
March 2008.
Pleadings, Trial and Judgment.The Tesoro Board met in an executive session in mid-February and
authorized the filing of a lawsuit against appellants. It understood
that it had the authority to initiate a lawsuit to enforce the
CC&R's without a vote of the entire Tesoro membership. As part of
its decision, the Tesoro Board considered that several homeowners had
complained about the solar panels on the slope; they had submitted a
signed petition and communicated their concerns to Euclid Management.
During a full meeting of the Tesoro homeowners on March 25, 2008, an
ACC representative reported that a lawsuit had been filed that day
against appellants because they had not followed architectural
procedures before installing a solar energy system on their slope.
Tesoro's complaint alleged causes of action for breach of contract and
negligence and sought declaratory and injunctive relief. The trial court
denied appellants' special motion to strike the complaint pursuant to
Code of Civil Procedure section 425.16. Tesoro thereafter filed the
operative first amended complaint, which alleged the same causes of
action and generally alleged that appellants' solar energy system
construction and installation failed to comply with several provisions
of the CC&R's.
Appellants answered and cross-complained against Tesoro, alleging
claims for breach of contract, breach of the implied covenant of good
faith and fair dealing, breach of the California Solar Rights Act (Civ.
Code, § 714)[4]
and declaratory and injunctive relief. Generally, they alleged that
Tesoro failed to comply with both section 714 and its own CC&R's in
denying their solar energy system application.
Tesoro moved for summary judgment on its complaint and the
cross-complaint, and appellants moved for summary judgment on the
complaint only. The trial court denied both motions, ruling that triable
issues of fact existed as to whether Tesoro complied or substantially
complied with its CC&R's and applicable law; whether Tesoro filed
the action in accordance with the CC&R's; whether Tesoro's asserted
noncompliance excused appellants' proceeding with the installation of
their solar energy system despite having notice of Tesoro's denial; and
whether Tesoro's denial complied with section 714. Summarizing, the
trial court ruled that the claims in the complaint and cross-complaint
turned on whether the parties met their obligations under the CC&R's
and governing law.
In June 2009, Tesoro designated four expert witnesses to testify at
trial. It designated solar energy forensic consultant Rod Bergen to
testify regarding Tesoro's compliance with section 714 in dealing with
appellants' solar energy system; the engineering, design and
installation of solar energy systems generally; appellants' solar energy
system as installed; and alternatives to that system. Appellants did
not designate any expert witnesses. In September 2009, the trial court
granted Tesoro's motion to strike appellants' untimely expert
designation offered three weeks late. The parties later stipulated that
appellants would be permitted to call experts to rebut any of the facts
relied on by Tesoro's experts; appellants experts were precluded,
however, from offering their own opinions.
In October 2009, the trial court granted Tesoro's request for a jury
trial. Appellants had objected to trial by jury, arguing that although
Tesoro had timely posted jury fees in accordance with a local rule
requiring posting 25 days before the actual trial date, it had not
complied with Code of Civil Procedure section 631 requiring that jury
fees be posted 25 days before the "initial" trial date. The trial court
allowed a jury trial, determining there was some ambiguity between the
two provisions and that appellants had failed to demonstrate any
prejudice as a result of allowing trial by jury.
Before trial began, the trial court also ruled on several motions in
limine, denying appellants' motion to preclude Tesoro from offering
expert testimony, appellants' motion to limit the testimony concerning
the meaning of the CC&R's, appellants' motion to preclude evidence
that Tesoro did not timely provide its notice of denial and appellants'
motion to preclude evidence that the notice of denial was incomplete.
As part of the jury instructions, the trial court informed the jury
about the nature of the dispute and the parties' contentions, stating
that Tesoro claimed it was entitled to declaratory and injunctive relief
because appellants had breached the CC&R's by installing their
solar energy system without written approval. It further stated that
appellants claimed Tesoro breached section 714 and the CC&R's by
improperly reviewing and denying their solar energy system application,
thereby entitling them to declaratory and injunctive relief.
Following a 10-day trial, on November 2, 2009, the jury returned a
special verdict. It found that Tesoro did nothing prohibited by the
CC&R's or governing law, nor did it fail to do anything required by
the CC&R's and governing law with respect to its consideration of
appellants' solar energy system. It further found that Tesoro did not
breach the implied covenant of good faith and fair dealing, did not
violate section 714, responded to appellants' application within the
time limits set forth in the CC&R's, responded to appellants'
application in the same manner as other applications for a change or
modification to property and was entitled to the relief requested. With
respect to appellants, the jury found that they either did something
prohibited or failed to do something required by the CC&R's and
governing law in connection with their solar energy system. It found
they were not excused from complying with the CC&R's and governing
law. The jury determined that appellants were not entitled to any relief
and were required to remove the 22 solar panels from their hillside
slope.
In December 2009, the trial court entered a judgment in favor of
Tesoro that incorporated the special verdict findings. As part of the
judgment, appellants were ordered to remove the 22 solar panels
installed on the slope and to return the slope landscaping to its
original condition within 60 days of entry of judgment. The trial court
further ordered that appellants take nothing on their cross-complaint
and awarded Tesoro its attorney fees and costs.
Appellants thereafter filed motions for judgment notwithstanding the
verdict and for a new trial. Following a February 10, 2010 hearing, the
trial court denied both motions. This appeal followed.
DISCUSSION
Appellants contend there are multiple reasons why the judgment should
be reversed. We loosely classify their arguments into three categories:
Legal, procedural and evidentiary. Addressing each category in turn, we
find no basis for reversal.
I. Appellants' Legal Claims.
Appellants raise several issues relating to the interpretation and
application of section 714, contending that any issue relating to that
provision should not have gone to the jury, the CC&R's as a matter
of law failed to comply with that provision and Tesoro did not satisfy
its burden under the statute. Keeping in mind that we review these
questions from a jury verdict, we find no merit to appellants'
contentions.
A. Appellants Properly Submitted the Question of Compliance with Civil Code Section 714 to the Jury.Section 714 prohibits homeowners associations from imposing
covenants, conditions or restrictions that effectively prohibit the
installation of a solar energy system. (§ 714, subd. (a).) The statute
further provides: "This section does not apply to provisions that impose
reasonable restrictions on solar energy systems. However, it is the
policy of the state to promote and encourage the use of solar energy
systems and to remove obstacles thereto. Accordingly, reasonable
restrictions on a solar energy system are those restrictions that do not
significantly increase the cost of the system or significantly decrease
its efficiency or specified performance, or that allow for an
alternative system of comparable cost, efficiency, and energy
conservation benefits." (§ 714, subd. (b).) Section 714 defines
"significantly" as "an amount exceeding 20 percent of the cost of the
system or decreasing the efficiency of the solar energy system by an
amount exceeding 20 percent, as originally specified and proposed" for a
solar water or swimming pool heating system, and as "an amount not to
exceed two thousand dollars ($2,000) over the system cost as originally
specified and proposed, or a decrease in system efficiency of an amount
exceeding 20 percent as originally specified and proposed" for a
photovoltaic system. (§ 714, subds. (d)(1)(A) & (B).)
Appellants now contend that the issue of Tesoro's compliance with
section 714 was a question of law that should not have been submitted to
the jury. They ignore the well settled rule "`that the theory upon
which a case is tried must be adhered to on appeal. A party is not
permitted to change his position and adopt a new and different theory on
appeal. To permit him to do so would not only be unfair to the trial
court, but manifestly unjust to the opposing litigant.' [Citations.]" (Cable Connection, Inc. v. DIRECTV, Inc. (2008) 44 Cal.4th 1334, 1351, fn. 12; see also Brown v. Boren (1999) 74 Cal.App.4th 1303, 1316
["It is a firmly entrenched principle of appellate practice that
litigants must adhere to the theory on which a case was tried. Stated
otherwise, a litigant may not change his or her position on appeal and
assert a new theory"].)
Consistently throughout the proceedings below, appellants maintained
that the question of Tesoro's compliance with section 714 was a question
of fact. In opposing Tesoro's motion for summary judgment, they argued
that whether Tesoro acted reasonably under the statute was a question of
fact. Before trial began, they did not ask the trial court to determine
the issue of compliance as a matter of law. During their opening
statement, they told the jury that whether they had the right to install
their solar panels involved a "factual determination" that it would
have to make. They questioned witnesses about the application of section
714. During closing argument, they reiterated that it was the jury's
obligation to apply California law to the situation presented. They
stipulated that the jury receive instructions on section 714; the jury
received those instructions and determined by special verdict that
Tesoro did nothing to violate the statute. In their post-trial motions,
they argued that substantial evidence did not support the jury's verdict
that Tesoro complied with section 714—not that the jury was prohibited
from deciding the question.
Appellants are bound by their decision to submit to the jury the
question of Tesoro's compliance with section 714. As aptly stated by the
court in Shumate v. Johnson Publishing Co. (1956) 139 Cal.App.2d 121, 130:
"A party cannot successfully take advantage of asserted error committed
by the court at his request. [Citation.] The request that the jury be
instructed as requested by defendants necessarily constituted consent to
submission of the issue as a question of fact to be resolved by the
jury. [Citation.] A party cannot request that an issue be submitted to a
jury as a question of fact and on review escape the consequences."
Moreover, appellants' position below was correct. Section 714,
subdivision (b) permits homeowners association to impose "reasonable
restrictions" on solar energy systems that do not significantly increase
the cost of the system or decrease its efficiency. The determination of
whether Tesoro's CC&R's and Design Guidelines imposed "reasonable"
restrictions was necessarily a question of fact for the jury. (See Ayres v. City Council of Los Angeles (1949) 34 Cal.2d 31, 41
[considering reasonableness of subdivision restrictions enacted
pursuant to the Subdivision Map Act and observing "[q]uestions of
reasonableness and necessity depend on matters of fact"]; Terry v. Atlantic Richfield Co. (1977) 72 Cal.App.3d 962, 966
["Except where there is no room for a reasonable difference of opinion,
the reasonableness of an act or omission is a question of fact, that
is, an issue which should be decided by a jury"]; Robinson v. City and County of San Francisco (1974) 41 Cal.App.3d 334, 337 ["Where evidence is fairly subject to more than one interpretation, the question of reasonableness is a triable factual issue for the jury to decide"].)
B. Substantial Evidence Supported the Jury's Finding that the CC&R's Imposed Reasonable Restrictions.Appellants' next—and also new—contention is that the CC&R's and
Design Guidelines applicable to solar energy systems are unreasonable as
a matter of law. Again, their position on appeal is contrary to the
position they took below, where they requested and the jury received an
instruction providing: "The parties stipulate that they are bound by the
C.C.&Rs, Bylaws, and Design Guidelines which have been referred to
as part of the Governing Documents and that such Governing Documents
constitute the binding contract between Plaintiff and Defendants." The
jury was further instructed that appellants claimed Tesoro breached the
governing documents by not complying with their provisions, and that
Tesoro had the burden to show its procedures were fair and reasonable.
Having submitted to the jury the question of whether Tesoro complied
with the CC&R's and Design Guidelines, appellants cannot now ignore
the jury's determination by attempting to change the question. (E.g., Kantlehner v. Bisceglia (1951) 102 Cal.App.2d 1, 6
["Counsel may not so conduct themselves in the trial of a case as to
lead the jury to proceed upon one theory and then seek to abandon that
theory upon appeal and adopt another one"].)
Again, appellants' position below was correct. Generally, homeowners
associations have the right to impose reasonable CC&R's on
improvements to property. (§ 1354, subd. (a) ["The covenants and
restrictions in the declaration shall be enforceable equitable
servitudes, unless unreasonable, and shall inure to the benefit of and
bind all owners of separate interests in the development"]; Dolan-King v. Rancho Santa Fe Assn. (2000) 81 Cal.App.4th 965, 977
["California and many other jurisdictions have long upheld such general
covenants vesting broad discretion in homeowners associations or boards
to grant or withhold consent to construction"]; Palos Verdes Homes Assn. v. Rodman (1986) 182 Cal.App.3d 324, 328 (Palos Verdes Homes)
["The right to enforce covenants that require approval of construction
has long been recognized in California"].) Generally, recorded use
restrictions are accorded a presumption of validity and are enforced
"unless they are wholly arbitrary, violate a fundamental public policy
or impose a burden on the use of affected land that far outweighs any
benefit." (Nahrstedt v. Lakeside Village Condominium Assn. (1994) 8 Cal.4th 361, 382.)
In Palos Verdes Homes, supra, 182 Cal.App.3d 324,
the court determined that whether a homeowners association's design
restrictions on a solar energy system were reasonable was a question of
fact. There, a homeowner installed a residential solar energy system
after the Palos Verdes Homes Association had denied his application for
installation on the basis that the system did not conform to its solar
unit guidelines. The association prevailed on its declaratory relief
claim at trial, and the court of appeal affirmed. According to the
court: "The issue here is whether the Association's Guidelines are a
`reasonable restriction' on the installation of solar units, as required
by section 714. This is a question of fact to be determined by the
trier of fact. Its conclusion will not be disturbed unless unsupported
by substantial evidence. [Citation.]" (Id. at p. 328.) The court
summarized the testimony of the association's expert, who opined that
the solar energy systems permitted by the association's guidelines were
comparable to the homeowner's proposed system in performance and cost. (Id.
at pp. 328-329.) Because the testimony showed that the "guidelines do
not prohibit all solar units but are formulated to promote the
installation of solar units which are comparable in costs and
aesthetically acceptable," the court concluded that substantial evidence
supported the judgment. (Id. at p. 328.)
The same result is required here. The CC&R's provide that the
approval or disapproval of applications for improvements "shall be in
the sole and absolute discretion of the [ACC] and may be based upon such
aesthetic considerations as the [ACC] determines to be appropriate."
The Design Guidelines temper this discretion with respect to the
installation of solar energy systems. They specifically mirror section
714 and provide that the ACC may impose reasonable restrictions "that do
not significantly increase the cost of the system or significantly
decrease its efficiency or specified performance, or which allow for an
alternative system of comparable costs, efficiency, and energy
conservation . . . ." As in Palos Verdes Homes, supra, 182 Cal.App.3d at page 328,
an expert testified about a comparable alternative system to
appellants' installation of 22 panels on their slope. Bergen explained
that the installation of 16 to 20 panels in an area above the casita
would yield the same performance efficiency but have a 14 percent
reduction in output. He further testified that the proposed system would
be less expensive to install than the slope panels. Bergen's testimony
established that the CC&R's and Design Guidelines allowed for an
alternative solar energy system of comparable costs and efficiency that
did not significantly increase the cost or decrease the efficiency of
the system sought by appellants. Substantial evidence supported the
jury's conclusion that CC&R's imposed reasonable restrictions that
were in compliance with section 714.
That the CC&R's permit the ACC to consider the aesthetic impact
of a solar energy system provides no basis for reversal. Nothing in the
language of section 714 prohibits the consideration of aesthetic
impacts. To the contrary, the provision in section 714 that "the
application for approval shall be processed and approved by the
appropriate approving entity in the same manner as an application for
approval of an architectural modification to the property" indicates
that the Legislature specifically anticipated that an evaluation of a
proposed solar energy system—just as any other proposed
improvement—would involve the consideration of aesthetics. (§ 714, subd.
(e)(1).) Consistent with that language, the Palos Verdes Homes
court concluded that guidelines primarily involving aesthetic
considerations were reasonable and met the standards of section 714. (Palos Verdes Homes, supra, 182 Cal.App.3d at p. 327.)
We are likewise unpersuaded by appellants' argument that Tesoro had
the burden to propose a comparable alternative system at the time it
denied appellants' application. Again, nothing in the language of
section 714 imposes such a burden on a homeowners association. The
statute requires only that the denial of a solar energy system
application be in writing and in a timely manner. (§ 714, subd. (e)(2).)
Nor do the CC&R's or Design Guidelines require that the ACC
redesign a solar energy system that fails to garner approval. Instead,
the burden is on the homeowner to submit an application that is complete
and sufficient to generate approval. ACC member Collins testified that
it has never been the practice of the ACC to propose an alternative
design and that he did not feel qualified to redesign a solar energy
system. The evidence established that once the ACC informed appellants
of the bases of its denial, it was their burden to reapply for approval
of a solar energy system utilizing an application that satisfied the
procedural requirements in the CC&R's and that addressed the ACC's
concerns about location, safety and aesthetics. Appellants failed to
meet their burden.
II. Appellants' Procedural Claims.
Notwithstanding the bases for Tesoro's denial of appellants' solar
energy system application, appellants contend that the process by which
Tesoro denied the application and initiated and tried this action was
invalid. Specifically, they contend that the ACC's denial was untimely,
inadequately mailed and incomplete; that the lawsuit was improperly
initiated without a vote of the entire association; and that Tesoro
should not have received a jury trial because it did not timely pay its
jury fees. With the exception of the payment of jury fees, appellants
submitted these issues to the jury for resolution, asserting during
closing argument that the key question in the matter was whether Tesoro
followed the appropriate procedures. We find no merit to any of
appellants' procedural challenges.
A. Substantial Evidence Established That Tesoro's Denial Complied with the CC&R's.The jury answered "yes" to the question of whether "Plaintiff
respond[ed] to Defendants' application for approval or disapproval of
the installation of their solar energy system within the time limits set
forth in the Governing Documents?" We review a jury's findings of fact
under the deferential substantial evidence standard. (Bickel v. City of Piedmont (1997) 16 Cal.4th 1040, 1053 superseded by statute in another point as stated in DeBarard Properties, Ltd. v. Lim (1999) 20 Cal.4th 659, 668.)
According to this standard, "`"the power of an appellate court begins
and ends with a determination as to whether there is any substantial
evidence, contradicted or uncontradicted," to support the findings
below.'" (Ibid.) We must view the evidence in the light most
favorable to the prevailing party, giving it the benefit of every
reasonable inference and resolving all conflicts in its favor. (Ibid.) We are not at liberty to reweigh the evidence or judge the credibility of witnesses. (Electronic Equipment Express, Inc. v. Donald H. Seiler & Co. (1981) 122 Cal.App.3d 834, 849.)
According to a provision in the section of the CC&R's governing
improvement applications, "all approvals given pursuant to this Article
shall be in writing; and any request for approval which has not been
approved or disapproved, in writing, within forty-five(45) days from the
date of receipt of all documentation required to be submitted by the
Committee shall be deemed approved . . . ." Here, the evidence showed
that appellants submitted their solar energy system application on
October 2, 2007. Prime testified that Martin personally delivered the
application on that date, and the application itself bore a "received"
stamp dated October 2, 2007. The jury was entitled to discredit Martin's
alternating recollection that he submitted the application on September
27 or October 1, 2007. (E.g., Moreno v. Sayre (1984) 162 Cal.App.3d 116, 121 ["It is the province of the jury to resolve conflicts in the evidence and to determine the credibility of witnesses"].)
The ACC denied appellants' application by letter dated November 8,
2007, a date within 45 days of receipt of appellants' application. Thus,
substantial evidence supported the jury's finding that Tesoro responded
within the time limits provided by the CC&R's. The evidence further
showed, however, that appellants did not receive the denial letter
until November 17, 2007 because it was misaddressed. But the jury was
instructed that Tesoro had the burden to prove that it "did all, or
substantially all, of the significant things that the Governing
Documents required it to do or that it was excused [from] doing those
things." It was well within the jury's province to conclude that Tesoro
substantially complied with its obligations under the CC&R's
notwithstanding appellants' receipt of the denial letter 46 days after
they submitted their application. (See Moreno v. Sayre, supra, 162 Cal.App.3d at p. 121
["When two or more inferences can be reasonably drawn from the facts,
the reviewing court is without power to substitute its deductions for
those of the jury"].) The jury could have concluded that the one-day
delay was inconsequential given that appellants had already signed the
contract to proceed with the installation of their solar energy system
several days before the time to rule on their application had expired.
The evidence further showed that Prime mailed the denial letter by
regular mail. We reject appellants' argument that this evidence showed
Tesoro failed to comply with section 16.11 of the CC&R's, which
provides in relevant part: "Any notice permitted or required by this
Declaration shall be considered received on the date the notice is
personally delivered to the recipient or forty-eight(48) hours after the
notice is deposited in the United States mail, first-class, registered
or certified mail, postage prepaid and addressed to the recipient at the
address which the recipient has provided to the Association . . . ."
Contrary to appellants' suggestion that this provision requires notices
to be sent by registered or certified mail, the provision is plainly
limited to specifying a date by which notice is deemed received if it is
sent by first-class, registered or certified mail. In short,
appellants' argument affords no basis to disturb the jury's finding that
Tesoro did all or substantially all of the significant things it was
required to do under the CC&R's.
Finally, appellants contend that substantial evidence did not support
the jury's affirmative answer to the question "Did Plaintiff respond to
Defendants' application for approval or disapproval of their solar
energy system in the same manner as any other applications for a change
or modification to property?" They argue that the denial letter
improperly failed to articulate the bases for the denial. (See § 1378,
subd. (a)(4) ["If a proposed change is disapproved, the written decision
shall include both an explanation of why the proposed change is
disapproved and a description of the procedure for reconsideration of
the decision by the board of directors"].) The evidence belies their
claim. Martin himself testified that attached to the November 2007
denial letter were four handwritten comments from the ACC indicating
that the casita roof should be considered as an alternate location, the
site plan failed to show dimensions and setbacks, the application
omitted any provision for slope maintenance and the application lacked
photographs of the proposed site. Martin conceded that he read the
comments when he received the denial letter. He further conceded that
his application in fact lacked the requisite items identified by the ACC
as missing. Later, in January 2008, the ACC approved the rooftop panel
installation but disallowed the panels on the slope for the reasons
stated earlier and discussed by all parties at their January 23, 2008
meeting. Substantial evidence showed that Tesoro provided an adequate
explanation of why appellants' solar energy system application was
ultimately denied in part.
The evidence further showed that to the extent Tesoro denied
appellants' application, it adequately advised him of his appeal rights.
(§ 1378, subd. (a)(4).) Though the January 2008 letter did not include
information about appeal rights, Martin testified that at all times he
had in his possession copies of the CC&R's and Design Guidelines and
was aware of the provision for appeal contained in the CC&R's.
Section 7.2.8 of the CC&R's provides a detailed explanation of a
homeowner's appeal rights in the event the ACC disapproves an
application. Evidence that appellants had been advised of their appeal
rights through the CC&R's supported the jury's findings that Tesoro
did all or substantially all it was required to do under California law
and appropriately responded to appellants' application in a manner
required for all similar applications. (See Stasher v. Harger-Haldeman (1962) 58 Cal.2d 23, 29 ["Substantial compliance, as the phrase is used in the decisions, means actual compliance in respect to the substance essential to every reasonable objective of the statute"].)
B. Substantial Evidence Established That Tesoro Properly Brought This Action in Accordance with the CC&R's.As part of its claim that Tesoro failed to comply with its own
CC&R's, appellants sought to show that Tesoro improperly initiated
this action without a full vote of the membership.[5]
The jury resolved this question against appellants, concluding that
Tesoro did all or substantially all it was required to do under the
CC&R's. Appellants do not contend that the jury should not have
resolved this question, but instead simply choose to ignore that
conflicting evidence was presented on the issue, the jury received
multiple instructions on contract interpretation and the jury decided
the issue. Where extrinsic evidence has been properly admitted to aid in
the interpretation of a contract, we uphold a reasonable construction
of the agreement by the trier of fact which is supported by substantial
evidence. (In re Marriage of Fonstein (1976) 17 Cal.3d 738, 746-747.)
During cross-examination, appellants' counsel questioned Collins
about section 4.1.2(k) of the CC&R's, which provides in part that
Tesoro has the right "to prosecute or defend, in the name of the
Association, any action affecting or relating to the Project or the
personal property thereon . . . provided, however, that without the
prior vote or written consent of a majority of the voting power of the
Members of the Association, the Board may not institute any legal
proceeding (including any arbitration or judicial reference proceeding)
against any person or entity the cost of which could reasonably be
expected to exceed Two Thousand Five Hundred Dollars ($2,500.00),"
including an estimate of attorney fees and costs. Collins testified that
no poll or vote of the homeowners was taken prior to Tesoro's
initiating this action against appellants. Martin similarly testified
that he was unaware of any meeting of the homeowners where they were
given an opportunity to vote on or receive notice of any intent to file a
lawsuit, nor was he given any notice of the special assessment
ultimately imposed to finance the litigation.
On redirect examination, however, Collins testified that the Tesoro
Board had relied on other provisions in the CC&R's—as well as the
advice of counsel—to conclude it had the ability to initiate suit
without a full vote. Specifically, it relied on section 4.1.2(e), which
gives Tesoro the right "to enforce, in its discretion, the provisions of
this Declaration, the Bylaws, Articles and Rules and Regulations of the
Association . . . ." He testified that counsel had advised him section
4.1.2(k) was never intended to limit the Tesoro Board's discretion under
section 4.1.2(e) to file suit against a homeowner. The Tesoro Board
also relied on section 10.9 of the CC&R's, which provides:
"Notwithstanding anything herein to the contrary, no judicial or
administrative proceeding shall be commenced or prosecuted by the
Association unless approved by a majority of the voting power of the
membership. This Section shall not apply, however, to (a) actions
brought by the Association to enforce the provisions of this
Declaration," the collection of assessments, challenges to ad valorem
taxes and counterclaims brought by Tesoro.
The owner of Euclid Management, Glennon Gray, further testified that
he was familiar with section 4.1.2(k) of the CC&R's and that the
provision did not operate to prevent Tesoro from filing an action
against a single homeowner to enforce the CC&R's. Rather, his
understanding was that it applied when a homeowners association was
contemplating suing the developer.
On the basis of this testimony, substantial evidence supported the
jury's determination that Tesoro complied with the CC&R's in
bringing this action without a full vote of the homeowners. (See Rosen v. E. C. Losch Co. (1965) 234 Cal.App.2d 324, 331 ["`The practical construction placed upon the agreement by the parties is, of course, substantial evidence of their intent'"]; Nicolaysen v. Pacific Home (1944) 65 Cal.App.2d 769, 773 ["`The law recognizes the practical construction of a contract as the best evidence of what was intended by its provisions'"].)
C. Tesoro Properly Received a Jury Trial.Appellants' final procedural challenge is that Tesoro should not have
received a jury trial because it did not post jury fees in a timely
manner. Before trial, appellants argued that Tesoro had waived its right
to a jury trial on the ground that it had not posted jury fees in
accordance with Code of Civil Procedure section 631, subdivision (b),
which specifies that jury fees must be deposited "at least 25 calendar
days before the date initially set for trial" by "[e]ach party demanding
a jury trial . . . ." Tesoro conceded that it had posted jury fees 25
days before the date set for the actual trial, which was timely
according to Los Angeles County Superior Court Local Rule 5.0. Following
briefing and argument by counsel, the trial court permitted a jury
trial to go forward, reasoning that Tesoro had demonstrated an
inadvertent mistake in relying on the local rules and appellants had
failed to demonstrate any prejudice from proceeding with a jury trial.
Generally, the failure to deposit jury fees at least 25 calendar days
before the date initially set for trial constitutes a waiver of the
right to a jury trial. (Code Civ. Proc., § 631, subds. (b) & (d)(5);Grafton Partners v. Superior Court (2005) 36 Cal.4th 944, 956.)
Nonetheless, in the event of a waiver, the trial court retains
discretion to allow a trial by jury. (Code Civ. Proc., § 631, subd. (e);Johnson-Stovall v. Superior Court (1993) 17 Cal.App.4th 808, 810; Gann v. Williams Brothers Realty, Inc. (1991) 231 Cal.App.3d 1698, 1703-1704.)
In exercising such discretion, courts are mindful of the requirement
"to resolve doubts in interpreting the waiver provisions of section 631
in favor of a litigant's right to jury trial. [Citations.]" (Grafton Partners v. Superior Court, supra, at p. 956.)
Accordingly, "[w]here the right to jury is threatened, the crucial
focus is whether any prejudice will be suffered by any party or the
court if a motion for relief from waiver is granted. [Citation.] A trial
court abuses its discretion as a matter of law when `. . . relief has
been denied where there has been no prejudice to the other party or to
the court from an inadvertent waiver. [Citations.]' [Citations.]" (Wharton v. Superior Court (1991) 231 Cal.App.3d 100, 104.)
Here, the trial court properly exercised its discretion to allow the
case to be heard before a jury. Tesoro demonstrated that it made an
inadvertent mistake by relying on the local rule timeline. (Winston v. Superior Court (1987) 196 Cal.App.3d 600, 602-603
[inadvertent waiver shown where failure to post fees occurred from
inconsistency in the time requirement among statutes].) And neither
below nor on appeal have appellants demonstrated any prejudice from a
trial by jury. (See Johnson-Stovall v. Superior Court, supra, 17 Cal.App.4th at p. 811 ["The mere fact that trial will be by jury is not prejudice per se"]; Gann v. Williams Brothers Realty, Inc., supra, 231 Cal.App.3d at p. 1704
["The prejudice which must be shown from granting relief from the
waiver is prejudice from the granting of relief and not prejudice from
the jury trial"].) "The court abuses its discretion in denying relief
where there has been no prejudice to the other party or to the court
from an inadvertent waiver." (Gann v. Williams Brothers Realty, Inc., supra, at p. 1704.) Indeed, it would have been an abuse of discretion for the trial court to deny relief here.
III. Appellants' Evidentiary Issues.
In two related arguments, appellants contend that the trial court
abused its discretion by permitting Bergen to testify as an expert on
Tesoro's behalf and by not permitting them to present rebuttal expert
testimony. We review the trial court's admission or exclusion of expert
testimony under the deferential abuse of discretion standard. (Avivi v. Centro Medico Urgente Medical Center (2008) 159 Cal.App.4th 463, 467; Piscitelli v. Friedenberg (2001) 87 Cal.App.4th 953, 972.)
A. Allowing Bergen to Testify was a Proper Exercise of Discretion.Bergen, a licensed contractor and electrical engineer who had
installed over 2,000 solar energy systems, evaluated appellants' solar
energy system as installed and opined that the slope location was
inappropriate based on a number of factors. He further testified that a
different configuration of panels could be more efficient and
cost-effective. He also opined about how removal of the slope panels and
replacement with his suggested alternative would affect the efficiency
and cost of appellants' solar energy system.
Appellants contend that it was an abuse of discretion to admit
Bergen's testimony because he lacked any "special knowledge" that would
qualify him as an expert. (Evid. Code, § 720, subd. (a) ["A person is
qualified to testify as an expert if he has special knowledge, skill,
experience, training, or education sufficient to qualify him as an
expert on the subject to which his testimony relates"].) They contend
that the matters about which he testified were matters of common
knowledge inappropriate for expert testimony. (See Evid. Code, § 801,
subd. (a) [expert opinion is admissible when it is "[r]elated to a
subject that is sufficiently beyond common experience that the opinion
of an expert would assist the trier of fact"]; People v. Torres (1995) 33 Cal.App.4th 37, 45
["Expert opinion is not admissible if it consists of inferences and
conclusions which can be drawn as easily and intelligently by the trier
of fact as by the witness"].) They claim that Bergen's testimony about
the reduction in efficiency resulting from a modification to appellants'
system could have been calculated using simple math—that is, a
reduction of 22 panels from a total of 56 would have equaled an
approximate 40 percent reduction in efficiency.
But the calculation was not so simple. Bergen explained that
efficiency is calculated taking into account the angle of the solar
panels, the orientation of the panels in relation to the sun, the
inverter design, surface area and shade factor. He used an incronometer
to measure the angle of the slope panels. In describing the design of
his alternative system, Bergen explained how an installation of fewer
than 22 panels would result in only a minimal reduction in output. He
further testified about the cost of labor and materials for his
alternative design. All of these matters were beyond the jury's common
knowledge. (See Mann v. Cracchiolo (1985) 38 Cal.3d 18, 38
[witness qualifies as an expert where he "has sufficient skill or
experience in the field so that his testimony would be likely to assist
the jury in the search for the truth, and `no hard and fast rule can be
laid down which would be applicable in every circumstance'"].)
Nor are we persuaded by appellants' renewed argument that Bergen
should not have been permitted to testify because he described an
alternative solar energy system that Tesoro did not propose at the time
it disallowed appellants' proposed system. Again, nothing in either
section 714 or the CC&R's required Tesoro to design an alternative
system, and the evidence established that it was not the ACC's practice
to redesign an applicant's proposal. The trial court properly exercised
its discretion to permit Bergen to testify about the efficiency and cost
of appellants' system as compared to an alternative system.
B. Appellants Stipulated They Would Not Offer Expert Testimony in Rebuttal.As a means of resolving Tesoro's motion to preclude appellants from
offering any expert testimony because of their failure timely to
designate experts, the parties stipulated that appellants would be
permitted to call Tesoro's experts and their own experts to rebut the
factual bases for any opinions offered by Tesoro's experts. Appellants
specifically agreed, however, that they would not be permitted to call
their own experts to offer rebuttal opinions. Notwithstanding this
stipulation, they now argue that the trial court abused its discretion
by not permitting them to call rebuttal witnesses to offer their own
expert opinions. By stipulating not to offer expert opinions, appellants
have waived any claim on appeal that the trial court abused its
discretion by enforcing the stipulation. (E.g., In re Marriage of Broderick (1989) 209 Cal.App.3d 489, 501
["an appellant waives his right to attack error by expressly or
implicitly agreeing or acquiescing at trial to the ruling or procedure
objected to on appeal"].)
Even absent any stipulation, we would find no abuse of discretion.
The general rule, set forth in Code of Civil Procedure section 2034.300,
is that an undesignated expert witness may not testify. An exception to
that rule is provided in Code of Civil Procedure section 2034.310,
which permits a party to call an undesignated expert witness to testify
if the expert has already been designated by another party, or if
"[t]hat expert is called as a witness to impeach the testimony of an
expert witness offered by any other party at the trial. This impeachment
may include testimony to the falsity or nonexistence of any fact used
as the foundation for any opinion by any other party's expert witness,
but may not include testimony that contradicts the opinion." (Code Civ.
Proc., § 2034.310, subds. (a) & (b).) Trial courts strictly construe
the foundational fact requirement in Code of Civil Procedure section
2034.310 "so as to `prevent a party from offering a contrary opinion of
his expert under the guise of impeachment.' [Citation.]" (Mizel v. City of Santa Monica (2001) 93 Cal.App.4th 1059, 1068.)
Here, there was no indication that any of appellants' three proposed
rebuttal expert witnesses satisfied the requirements of the statutory
exception.[6]
Appellants sought to call Jamie Muniak, a certified property manager,
to offer his own opinions about customs and practices in the property
management industry. They also called Marco Suarez, the owner of
Advanced Solar Electric, as a percipient witness, but the trial court
sustained objections to questions designed to elicit expert opinion
about solar energy system installations. Finally, appellants sought to
call a contractor, identified as Mr. Alcantar, to offer an opinion about
the cost of Bergen's proposed alternative system and testify about his
proposed bid. His testimony would have been based on his construction
experience and did not include any testimony designed to establish the
falsity or nonexistence of any fact relied on by Bergen in making his
costs estimate. In any event, Martin was permitted to testify about
other estimates he had received to construct the solar energy system
proposed by Bergen.
"The trial court is vested with a sound discretion as to the permissible scope of evidence offered in rebuttal. [Citation.]" (Johnston v. Brewer (1940) 40 Cal.App.2d 583, 588.)
Because appellants' proffered rebuttal expert testimony failed to
satisfy the requirements of Code of Civil Procedure section 2034.310,
the trial court properly exercised its discretion in precluding such
testimony.
DISPOSITIONThe judgment is affirmed. Tesoro is awarded its costs on appeal.[7]
ASHMANN-GERST, J. and CHAVEZ, J., concurs.
ORDER MODIFYING OPINION AND CERTIFYING OPINION FOR PUBLICATION
[NO CHANGE IN JUDGMENT]
THE COURT:[*]
It is ordered that the opinion filed herein on October 3, 2011, be modified as follows:
On page one, the opinion caption "TEROSO DEL VALLE MASTER HOMEOWNERS
ASSOCIATION" should read: "TESORO DEL VALLE MASTER HOMEOWNERS
ASSOCIATION."
There is no change in the judgment.
The opinion in the above-entitled matter was not certified for publication in the Official Reports.
For good cause it now appears that the opinion should be published in the Official Reports and it is so ordered.
[1] We occasionally refer to appellant Martin Griffin individually by first name to avoid confusion and not out of disrespect.
[2] At trial, Martin testified that he believed he submitted the application on September 27, 2007.
[3]
The ACC had cancelled its regularly-scheduled October meeting because
the area was evacuated for a fire. For that reason, it did not consider
appellants' application until November 6, 2007.
[4] Unless otherwise indicated, all further statutory references are to the Civil Code.
[5]
We decline to address appellants' argument on this issue to the extent
it is premised on the denial of their summary judgment motion. (E.g., California Housing Finance Agency v. Hanover/California Management & Accounting Center, Inc. (2007) 148 Cal.App.4th 682, 688-689 [denial of summary judgment unreviewable after a full trial on the same issues]; Waller v. TJD, Inc. (1993) 12 Cal.App.4th 830, 833-836 [same].)
[6]
That appellants failed to make an offer of proof of their witnesses'
proposed testimony is yet an independent reason why any claim of error
has been waived. (E.g., In re Mark C. (1992) 7 Cal.App.4th 433, 444.)
[7]
In its respondent's brief, Tesoro has requested an award of attorney
fees on appeal. We decline to consider its request. California Rules of
Court, rule 3.1702(c) sets forth the procedure for claiming attorney
fees on appeal. (See also Cal. Rules of Court, rule 8.278(d)(2).)
[*] DOI TODD, Acting, P. J. ASHMANN-GERST, J. CHAVEZ, J.