Kwei v. San Jose Water Co.

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LONG KWEI, Individually and as Trustee, etc., et al., Plaintiffs and Appellants, v. SAN JOSE WATER COMPANY, Defendant and Respondent.

H050233

California Court of Appeals, Sixth District

March 28, 2023

NOT TO BE PUBLISHED

Santa Clara County Super. Ct. No. 22CV396283

WILLIAMS, J. ^[*]

Appellants Long Kwei and Huey-Lin Kwei, both individually and as trustees of the Long Kwei and Huey-Lin Kwei Revocable Trust dated August 31, 2011 (collectively, the Kweis), appeal from the trial court's order denying their motion to compel arbitration of their present dispute with respondent San Jose Water Company (SJWC). The dispute concerns SJWC's alleged misuse and overuse of areas within two recorded easements burdening two contiguous lots owned by the Kweis located in Saratoga, California, for a period of roughly a year and a half in 2019 and 2020, causing damage to the Kweis' property both within and beyond the easements. During this period, SJWC constructed its Pike Road Reservoir Tank Replacement Project (the Project) on its adjacent property and used the Kweis' driveway, which appears from the record to be roughly within the easement areas, for prolonged and continuous access and use by construction and heavy-equipment vehicles on their way to and from the Project site, five days per week.

The parties had entered into a Road Maintenance and Repair Agreement (Agreement) in 2015 affecting the Kweis' driveway, which Agreement included an arbitration clause but nowhere mentioned the easements or their properly delineated use and scope. Nor did the Agreement address SJWC's access rights over the Kweis' property for ingress and egress, instead focusing solely on the respective and newly established payment obligations for regular maintenance and repair of two specified portions of the Kweis' driveway the first portion by both sides and the second by SJWC alone. The trial court concluded that the scope of the Agreement and its arbitration provision did not include the Kweis' present claims, which are pleaded in causes of action for nuisance, trespass, negligence, forfeiture of easement, and declaratory relief. As pleaded, the claims are all rooted in the grants of easements and SJWC's use, and alleged misuse and overuse thereof, during SJWC's construction of the Project, and not in the later Agreement containing the arbitration clause.

Finding no error, we affirm the order.

STATEMENT OF THE CASE

I. Factual Background

The Kweis became the owners of their real property, consisting of two contiguous lots in a cul-de-sac located in a hillside area in Saratoga, in 1994. The property is located on Toll Gate Road, and it was and remains encumbered by two easements benefitting SJWC, which owns an adjacent lot, historically the site of a water tank. The two grants of easement were recorded with the County Recorder in 1982. One easement is described as a "20 foot Ingre[s]s Egress Easement" and the other is described as a "Slope Easement." Both easements burden both Kwei lots and are described as granting "[t]he right and privilege of excavating for and laying pipeline as and when and as often as the same may be desirable in the opinion of [S]WC], together with all fittings, connections, and appliances which [S]WC] may desire to install in connection therewith, for the transmission and distribution of water, and also the right of maintaining using, and replacing and/or enlarging the same for such purposes, and also the right and privilege of relaying, repairing, removing, and/or renewing the same, using pipe, fittings, connections and/or appliances either of the same size or sizes as may first be installed or of any other size or sizes, and also a right of way and right to construct, maintain and use a paved roadway along the same, upon, in, through, along, and across the following described land . . . [legal description of the Kwei properties]." Both recorded easements provide that the "respective rights, covenants, and conditions contained herein shall inure to the benefit of and be binding upon the heirs, successors, and assigns of the parties [t]hereto."

The Kweis "have a private driveway of approximately 650 feet that connects the cul-de-sac of Toll Gate Road with the[ir] house (the 'First Portion'), and a further driveway of about 450 feet that extends from [their] house to a gated entrance of the Pike Road Reservoir property owned by SJWC, where a water tank is situated (the 'Second Portion'). The entire First Portion [of the driveway] is on [the Kwei] property and it was completely repaved in 2015. Only [about] 120 feet (out of the 450 feet) of the Second Portion is on [their] property, and the rest is on a neighbor's and SJWC's property[.] . . . [T]he Second Portion has not been repaved since [the Kweis] purchased the two lots in 1994."

SJWC uses the driveway on the Kwei property "under the Easements to access its Pike Road Reservoir property." The parties negotiated for some 12 years about their respective obligations for regular maintenance and repair of the driveway before they entered into the written Road Maintenance and Repair Agreement, drafted by SJWC, on February 5, 2015. The Agreement is expressly intended "to achieve the objective of maintaining and repairing a portion of private driveway extending approximately one thousand and one hundred feet (1,100) in a westerly direction from the cul-de-sac of Toll Gate Road to the gated entrance of SJWC's real property (the "Driveway Property") .... The road surface subject to maintenance or repair under this

Agreement shall be the commonly traveled surface only as described in paragraph 2(a) below." (Initial caps omitted.)

Before getting to paragraph 2, the Agreement in paragraph 1 describes the "scope of maintenance and repair" contemplated. (Capitalization &boldface omitted.) It provides in part that the "[p]arties [will] be equally responsible for the routine maintenance of the road surface over the portion of the Driveway Property for which they are 50 percent (50%) responsible . . . as described in paragraph 2(a) below (the 'First Portion').... In addition to routine maintenance, the parties shall also be equally responsible for completing all repairs reasonably required to be made on the First Portion of Driveway Property in order to have it remain serviceable and safe.... [¶] SJWC shall maintain and repair the portion of the Driveway Property described in paragraph 2(b) below in its sole discretion." (Italics added.)

Paragraph 2 the Agreement addresses the "cost of maintenance or repair" (capitalization &boldface omitted) and provides that "[t]he Parties shall share in the cost of the maintenance and repair" as described in subparagraphs 2(a) and 2(b). (Italics added.) Paragraph 2(a) provides that "[f]or the Driveway Property from the cul-de-sac of Toll Gate Road westerly, approximately six hundred and fifty feet (650') to the westerly most driveway entrance to lot 17, the parties shall split the cost of maintenance or repair fifty percent (50%) to Kwei Revocable Trust and fifty percent (50%) to SJWC." (Capitalization omitted.) Paragraph 2(b), in contrast, provides that "[f]or the Driveway Property extending from the end of the Driveway Property described in Paragraph 2(a) westerly, approximately four hundred and fifty feet (450') to the gated entrance of SJWC's Pike Road Reservoir property, SJWC shall be responsible for one hundred percent (100%) of the cost of maintenance or repair."

The "Driveway Property" from aerial view is depicted on Exhibit A to the Agreement, shown here:

(Image Omitted)

Paragraph 4 of the Agreement addresses dispute resolution. It provides in pertinent part (in all caps, omitted here) that "any dispute arising out of or in any way related to this Agreement shall be resolved through alternative dispute resolution ('ADR') . . . first by mediation and if not successful, then by arbitration ...." (Capitalization &boldface omitted, italics added.) It goes on to specify the procedural mechanisms and terms for ADR under the Agreement, the powers of the arbitrator, the type of relief available, and the manner by which the parties will bear associated attorney fees and costs.

Paragraph 7 of the Agreement is an integration clause affecting the application of the parol evidence rule in construing the document; paragraph 9 provides that the Agreement is binding on the parties' respective successors and assigns; and paragraph 10 provides for the Agreement to be recorded in the official records of Santa Clara County. The Agreement was fully executed and recorded on February 11, 2015. It nowhere mentions or references either of the two easements that burden the Kweis' property and benefit SJWC's property, or their proper scope and use, or any rights or obligations related thereto. But, according to Long Kwei, the Kweis' "private driveway," which is the subject of the Agreement, "appears subject to the easements," meaning physically located, at least in some part, within one or both of them.^[1] According to Long Kwei's declaration filed in support of their motion to compel arbitration, "[f]rom approximately April 2019 until September 2020, for its reservoir tank replacement project, SJWC caused heavy machinery and trucks to pass through [the Kweis'] driveway 9-5 every weekday. SJWC did not obtain [the Kweis'] consent. Nor did it even notify [them] before the construction began." Further, "[t]he frequent traffic with the noise and vibrations annoyed [the Kweis] and disturbed [their] quiet enjoyment of [their] lives. In addition, on or about June 09, 2020, a manlift emitted sparks and caused a brushfire. The fire grew very rapidly, and it was only yards away from the [Kweis'] house before a crew member put it down with [their] garden hose....