Michael v. Sabin

SIMON MICHAEL, Cross-complainant and Respondent, v. GAIL SABIN et al., Cross-defendants and Appellants.

A156137

COURT OF APPEAL OF THE STATE OF CALIFORNIA FIRST APPELLATE DISTRICT DIVISION TWO

June 29, 2020

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

(San Francisco County Super. Ct. No. CGC-15-547916)

This appeal stems from a feud between neighbors over a project involving the expansion of a San Francisco home. The primary contestants in what has become a drawn-out legal battle are Sidney and Nancy Unobskey,¹ on the one hand, and the defendant and cross-complainant Simon Michael on the other. Both the Unobskeys and Michael have sued each other and each other's contractors or consultants.

The pleading at issue in this appeal is Michael's cross-complaint against the Unobskeys, their architect Gary Millar, and their personal assistant Gail Sabin. The Unobskeys, Millar and Sabin responded to thatcross-complaint by filing an anti-SLAPP motion, which for various reasons the trial court denied.² Millar and Sabin contend the trial court erred in denying the anti-SLAPP motion as to Michael's claims against them. The issues before us are whether Millar and Sabin have shown the cross-complaint against them is based on protected activity as defined in the anti-SLAPP statute, Code of Civil Procedure section 425.16, and, if so, whether Michael has demonstrated a probability of prevailing on his claims against them.³ Exercising de novo review, we conclude the cross-complaint is based on protected activity under section 425.16, subdivision (e)(2) and that Michael has not shown a likelihood of prevailing on the merits of his cross-claims. We therefore reverse the order of the trial court and remand with instructions to dismiss the cross-complaint against Millar and Sabin.

BACKGROUND

I.Facts and Allegations

Sidney and Nancy Unobskey and Simon Michael and his wife Margaret own homes on adjoining lots in a tony neighborhood in San Francisco.⁴ Prior to purchasing his home in 2011, Michael and his family rented a part of that dwelling from the prior owner for almost 20 years. Although the Unobskeys and the Michael family were long-time neighbors, they became embroiled in an increasingly contentious dispute when, after purchasing his home, Michael commenced a major construction project involving excavation andremodeling that entailed digging piers on the property line adjacent to the Unobskeys' property.

Michael's project has required permits and other government approvals, to many of which the Unobskeys raised objections, made complaints or filed appeals with local government officials and tribunals. In about 2013, Unobskey⁵ complained to the San Francisco Department of Building Inspection (DBI) that Michael had undertaken work outside the scope of a permit, and in 2014, he opposed and appealed the Planning Department's issuance of a variance to Michael. In January 2015, Unobskey agreed to withdraw his appeal of the variance decision and entered into a partial settlement agreement with Michael. The settlement agreement was limited, with neither party admitting any liability, and it specifically reserved the Unobskeys' right to claim Michael's construction work had damaged their property. Unobskey continued to register objections with local government authorities regarding Michael's project and continued to complain that his excavation work had caused settlement of the Unobskeys' property. Unobskey also contended Michael should be required to remove two balconies or decks at the rear of his property, which he contended were unpermitted and intruded on the Unobskeys' privacy. In August 2015, Unobskey appealed from a permit decision involving the third phase of Michael's project, unsuccessfully arguing about these same issues and contending that the work required environmental review.

Throughout the course of the administrative proceedings, Michael accused Unobskey of attempting to "extort" him by objecting to his project inan effort to get him to agree in advance not to object to a planned expansion by the Unobskeys of their own home. He disagreed strenuously with their argument that his excavation work had caused any significant settling of their property and accused them of trying to cover up the fact that they had experienced substantial settlement long prior to when Michael began his excavation work. At some of the administrative hearings, the Unobskeys spoke on their own behalf, at others they were represented by counsel, and on one or more occasions Millar spoke on their behalf.

In September 2015, Unobskey filed the complaint in this action against Michael and three of his contractors, asserting they violated Civil Code section 832, which governs landowners' responsibilities to adjoining owners when making improvements that involve excavation. Unobskey's complaint also asserted causes of action for negligence, nuisance, trespass, breach of the settlement agreement and the covenant of good faith and fair dealing, and declaratory relief. The thrust of that complaint is that Michael's excavation work deprived the Unobskeys' property "of lateral and subadjacent support" resulting in past and continuing subsidence of the soil under the property and settlement of the structural improvements on it.

In June 2016, Michael filed a cross-complaint against the Unobskeys, and in July 2018 (with permission of the court), filed a first amended cross-complaint adding Millar and Sabin as cross-defendants. The first amended cross-complaint, which we will simply refer to as the "cross-complaint," is the subject of this appeal. The primary targets of the cross-complaint were the Unobskeys. As he did in the administrative proceedings, Michael alleged in the cross-complaint that Unobskey attempted to "extort" him by threatening to "challenge every aspect of Michael's project and make every effort to delay or prevent it" unless Michael agreed to allow the Unobskeys to undertake amajor expansion of their own home that would block windows and balconies on Michael's property and "compromise Michael's privacy." The cross-complaint alleged that after Michael declined to sign Unobskey's proposed expansion agreement, (1) Unobskey reported Michael to the DBI, claiming he had done work that was outside of the scope of his building permit, (2) in an effort to cover up Unobskey's extortionate demands, Nancy Unobskey falsely testified at the hearing on Michael's request for a variance that her family had " '[n]o plans to expand the building, our home, at all at this time,' " (3) the Unobskeys' appeal from the variance raised issues that were "trivial," "contrived" and "unrelated to the variances" sought, had "no substantive basis" and was an effort "to extort concessions from Michael," Unobskey engaged in various frauds and "bullying tactics" in connection with the appeal, and the Unobskeys' conduct in connection with the appeal "delayed [Michael's] construction by well over 6 months." Michael also alleged the Unobskeys installed a new and improperly constructed foundation during remodeling of their home in the 1990s, there are underground streams beneath the Unobskeys' home, and the streams and defective foundation caused settlement damage to their home that long pre-existed Michael's excavation work.

Finally, and most significantly for purposes of this appeal, Michael alleged that Unobskey, with the participation of his architect Millar, falsely claimed Michael's "pier work had caused a large amount of settlement damage" to the Unobskeys' home and demanded a repair that would cost $700,000 to $900,000, when the settlement of the Unobskeys' home after Michael's construction began was de minimis and the settlement problem affecting the Unobskeys' home was longstanding and the product of the Unobskeys' own earlier defective foundation work. Unobskey's efforts "toblame Michael's construction for current and future settlement of [Unobskey's] property" allegedly included "go[ing] to other neighbors and alarm[ing] them by claiming that Michael's construction [work] threaten[ed] their foundations."

The particular allegations as to Millar were that he "acted as 'point man' for [Unobskey] and assisted [him] in harassing the Michael project in numerous ways." Michael alleged Millar "purposefully misled Michael and his consultants into believing that Michael's construction had caused 'new distress' at [the Unobskeys'] house," when he knew the " 'new distress' at [their] house existed prior to Michael starting construction because there were pre-construction photos showing the same 'distress.' " He also alleged Millar "purposely withheld information from [Unobskey's] consultants, Luis Moura and Alex Rood, relating to this 'new distress' so that Mr. Moura and Mr. Rood would prepare reports blaming the 'new distress' on Michael's construction. The false reports would then be used to support [the Unobskeys'] appeals of Michael's permits." Millar also allegedly assisted Unobskey in withholding damaging documents, including a report from another expert opining that "any negative impact on your building should be minimal to negligible." The fraud cause of action also included allegations that Millar misrepresented to Michael that the balconies on his property were not legally permitted. This was false, Millar alleged, because "[t]here was a legal permit on file for one of the balconies, and strong evidence that in fact both balconies were legally permitted," and "Michael's balconies were, in fact, legal and had existed for a significantly long time."

As to Sabin, Michael alleged she was Unobskey's "personal assistant" who also knew of the prior settlement and "denied that [Unobskey] ever...