Long Canyon Phase II & III Homeowners Ass'n, Inc. v. Cashion

• Decision Date: 03 March 2017
• Docket Number: NO. 03–15–00498–CV,03–15–00498–CV
• Citation: 517 S.W.3d 212
• Parties: LONG CANYON PHASE II AND III HOMEOWNERS ASSOCIATION, INC., Appellant v. Chris CASHION and Lisa Cashion, Appellees
• Court: Texas Court of Appeals

517 S.W.3d 212

LONG CANYON PHASE II AND III HOMEOWNERS ASSOCIATION, INC., Appellant

v.Chris CASHION and Lisa Cashion, Appellees

NO. 03–15–00498–CV

Court of Appeals of Texas, Austin.

Filed: March 3, 2017

William C. Davidson, Bradley Rockwell, Amy C. Welborn, Austin, for Chris Cashion and Lisa Cashion.

Adam Robertson, Amy M. Van Hoose, Mark B. Rabe, Frank Carroll III, Houston, for Long Canyon Phase II and III Homeowners Association, Inc.

Before Chief Justice Rose, Justices Pemberton and Field

OPINION

Jeff Rose, Chief Justice

Long Canyon Phase II and III Homeowners Association, Inc. ("the HOA") appeals from an interlocutory order denying its motion to dismiss a suit by Chris and Lisa Cashion. The parties have for several years disputed whether the Cashions' alleged landscaping activities in a drainage easement violate the HOA's rules. After the HOA sent the Cashions a notice of intent to sue for non-compliance with those HOA rules, the Cashions sued the HOA¹ claiming damages from harassment, negligence, and severe emotional distress, as well as seeking injunctive and declaratory relief. The HOA moved to dismiss the Cashions' suit under the Texas Citizens' Participation Act (TCPA), arguing that the Cashions' suit infringed on the HOA's exercise of its rights to associate and to petition the government, as defined in the Act.² The district court denied the HOA's motion. We will reverse the trial court's order in part, render judgment dismissing certain of the Cashions' claims, and affirm the remainder of the order.

Background

The Cashions are homeowners whose property is subject to covenants that mandate membership in the HOA and restrict landscaping activities in a drainage easement that runs across part of the Cashions' property. The Cashions recite a history of conflict dating to 2009 when the HOA refused to return their construction deposit on grounds that they had improperly cut trees in the easement. The Cashions assert that they sued the HOA and recovered the deposit.

The current dispute flared when the HOA sent the Cashions a letter dated December 18, 2014, asserting that the Cashions had unlawfully damaged the drainage easement. In the letter, the HOA board, through counsel, threatened to fine the Cashions, file suit, and seek damages.

The Cashions replied by letter dated December 23, 2014, then filed this suit in the county court at law in February 2015. In their original petition, the Cashions complain that the HOA, acting in bad faith, "intentionally communicated through authorizing its attorney to write in a coarse and offensive manner, a letter addressed to the Cashions and by such action, [the HOA] and the Board intentionally annoyed and alarmed the Cashions on Christmas Eve."³ The Cashions complain that the letter contained false and unsupported allegations regarding their conduct in the easement from July 2013 to December 2014. The Cashions also complain that the HOA breached its duty to supervise its representatives by allowing them to harass the Cashions over matters outside their power. They allege that the HOA monitored visitors, watched yardworkers, made their presence known, trespassed, and took pictures of the Cashions' property without consent. The Cashions complain that the HOA "acted with intent to cause emotional distress to the Cashions," which emotional distress "was severe."

The Cashions assert that the HOA filed suit in district court against them on April 1, 2015, they filed a plea in abatement in that suit, and the HOA then filed this motion to dismiss under the TCPA. The trial court denied the HOA's motion to dismiss without stating a basis. The HOA appeals this denial.

TCPA Dismissal Procedure

"The purpose of the [Citizens Participation Act] is to encourage and safeguard the constitutional rights of persons to petition, speak freely, associate freely, and otherwise participate in government to the maximum extent permitted by law and, at the same time, protect the rights of a person to file meritorious lawsuits for demonstrable injury."⁴ To that end, the TCPA provides a mechanism for dismissal of a "legal action" that is "based on, relates to, or is in response to a party's exercise of the right of free speech, right to petition, or right of association,"⁵ as defined in the Act, and for which "the party bringing the legal action [cannot] establish [ ] by clear and specific evidence a prima facie case for each essential element of the claim in question."⁶ Texas courts' brief history in applying the broadly worded TCPA has not limited application of the Act's protections to weighty issues of great public concern. The dismissal mechanism of the statute has been applied in cases for fraud and barratry,⁷ a suit for contamination of a water well,⁸ a dispute between neighbors over a fence,⁹ defamation claims arising from an employment dispute,¹⁰ a snarl of competing claims arising from discussions among horse breeders on social media,¹¹ and a host of other types of claims.

A party moving to dismiss under the TCPA must "show[ ] by a preponderance of the evidence that the [nonmovant's] legal action is based on, relates to, or is in response to the [movant]'s exercise of (1) the right of free speech; (2) the right to petition; or (3) the right of association."¹² "Exercise of the right of free speech" is defined in the TCPA as "a communication made in connection with a matter of public concern."¹³ "Exercise of the right to petition" is defined, in part, as "a communication in or pertaining to ... a judicial proceeding" and as "any other communication that falls within the protection of the right to petition government under the Constitution of the United States or the constitution of this state."¹⁴ Finally, "exercise of the right of association" is defined as "a communication between individuals who join together to collectively express, promote, pursue, or defend common interests,"¹⁵ with "communication" being separately defined as "the making or submitting of a statement or document in any form or medium, including oral, visual, written, audiovisual, or electronic."¹⁶

To avoid dismissal under a TCPA motion to dismiss, the nonmovant must "establish[ ] by clear and specific evidence a prima facie case for each essential element of the claim in question."¹⁷ But even where a prima facie case has been made, the trial court "shall dismiss a legal action against the moving party if the moving party establishes by a preponderance of the evidence each essential element of a valid defense to the nomovant's claim."¹⁸ In a section titled "Evidence," the TCPA instructs, "In determining whether a legal action should be dismissed ..., the court shall consider the pleadings and supporting and opposing affidavits stating the facts on which the liability or defense is based."¹⁹ We review de novo whether each party carried its assigned burden.²⁰

Discussion

The HOA's sole issue on appeal is that the trial court erred in denying the HOA's TCPA motion to dismiss. The HOA contends specifically that the Cashions' claims improperly infringe on the HOA's "exercise of the right to petition" because those claims are based on the HOA's letter giving notice of its intent to sue. The HOA also asserts that the Cashions' claims improperly infringe on its "exercise of the right of association" because the HOA's presuit notice was an exercise of the HOA's right to express, promote, pursue, and defend its common interest of preserving and protecting the drainage easements created by the neighborhood covenants.

Scope of the appeal

During the dismissal hearing, the HOA expressly withdrew the portion of its motion that challenged the Cashions' declaratory-judgment claims. Accordingly, the HOA's potential bases for reversal here are limited to the Cashions' remaining claims seeking monetary and injunctive relief, which are unquestionably "legal actions" potentially subject to dismissal under the TCPA.²¹ The HOA's motion sought dismissal of these "legal actions" on the ground that each was predicated factually on the "presuit notice" or "HOA" letter dated December 18, 2014, and that this letter was TCPA-protected expression. In the letter, the HOA board, through counsel, threatens to fine the Cashions $8,000 and sue them for $10,000 in damages, plus attorney's fees, and to place a lien on their property to secure payment of the judgment, based on alleged violations of deed restrictions that limited the Cashions' use or maintenance of a portion of their property that was burdened by a drainage easement. The HOA raised no other communication or expression on its part as the basis for its motion, and this narrow focus has important corresponding implications for the scope of relief the HOA can obtain on appeal.

The HOA's motion sought dismissal of the Cashions' monetary and injunctive claims in their entirety under the premise that the claims complained solely of the December 18 letter. A review of the evidence—viewed in the light most favorable to the Cashions, as required by the governing standard of review—reveals that the factual bases for the Cashion's claims are much broader than this. Although the Cashions do complain about the letter in their live petition (terming it a "coarse and offensive" missive calculated to "alarm [ ]," "caus[e] emotional distress," and even ruin their Christmas holidays), they present it as a component of a larger "pattern of harassment" and "bad faith" or "ultra vires" conduct by the HOA board and "some of the [HOA] members." This conduct, the Cashions alleged, has included "constantly monitor [ing] visitors of the Cashions, watch[ing] whenever someone comes to work in the [Cashions'] yard, and "mak[ing] their presence known," as well as "trespass [ing] on the Cashions' property and tak[ing] pictures [there] without their consent."

In addition to the Cashions' pleadings, the trial court had other evidence before it that provided further background and context regarding the nature of the parties' dispute and the...