Felipa Richland Eith et al., Plaintiffs and Appellants, v. Jeffrey Ketelhut et al., Defendants and Appellants; Los Robles Hills Estates Homeowners Association et al., Defendants and Respondents.

Summary by David A. Kline, Esq.:

Facts:

Homeowner Ketelhut planted grape vines on his property with the association’s permission. Neighboring homeowners complained when they learned that Ketelhut had been using the grapes to make wine offsite and sell that wine. The board decided that the vineyard operation did not violate the CC&R prohibition against commercial activity because it did not affect the residential character of the community.

Held:

For the association and Ketelhut. The prohibition on business or commercial activity does not encompass activity that does not affect the community’s residential character. Board members lived in the community and were in a better position than the courts to evaluate the vineyard’s effect on the community. The court deferred to the board’s decision that the vineyard did not affect the residential character of the community because the board’s decision was based on a reasonable investigation.

***End Summary***

2d Civil No. B272028.

Court of Appeals of California, Second District, Division Six.

Filed December 17, 2018.

Appeal from the Superior Court of Ventura County, Super. Ct. No. 56-2011-00403140-CU-OR-VTA. Henry J. Walsh, John Nguyen, Judges.

Richland & Associates, Felipa R. Richland, in propria persona, for Plaintiffs and Appellants Felipa Richland Eith and Jeffrey Eith.

The Aftergood Law Firm, Aaron D. Aftergood for Plaintiffs and Appellants Thomasine Mitchell, John Mitchell, Philip Chang and Eileen Gabler; Freeman Freeman & Smiley, Steven E. Young for Plaintiffs and Appellants Stacy Wasserman and Morrey Wasserman.

Yoka & Smith, Christopher E. Faenza, Christine C. De Metruis for Defendants and Appellants Jeffrey Ketelhut and Marcella Ketelhut; Slaughter, Reagan & Cole, Barry J. Reagan, Gabriele M. Lashly, Michael Lebow for Defendants and Respondents Los Robles Hills Estates HOA, Michael Daily, Jeanne Yen and Frank Niesner.

CERTIFIED FOR PARTIAL PUBLICATION[*]

GILBERT, P. J.

In Lamden v. La Jolla Shores Clubdominium Homeowners Assn. (1999) 21 Cal.4th 249 (Lamden), our Supreme Court cautioned courts to give judicial deference to certain discretionary decisions of duly constituted homeowners association boards. The judicial deference rule does not encompass legal questions that may involve the interpretation of the covenants, conditions, and restrictions (CC&Rs) of a homeowners association. Courts decide legal questions.

Here, homeowners cultivated a vineyard for the purpose of making wine to be sold to the public. The CC&Rs did not prohibit the cultivation of a vineyard for this purpose, but they did prohibit “any business or commercial activity.” The operation of the vineyard may have constituted “business or commercial activity” in the literal sense of that term. But a literal interpretation in the present case would elevate form over substance and lead to absurd results. (See SDC/Pullman Partners v. Tolo Inc. (1997) 60 Cal.App.4th 37, 46 [“literal language of a contract does not control if it leads to absurdity”].) Because the wine was made, bottled, and sold commercially offsite, and the activity at the vineyard did not affect the residential character of the community, we conclude there was no business or commercial activity within the meaning of the CC&Rs. The homeowners association board acted within its discretion in allowing the continued operation of the vineyard, and its decision is entitled to judicial deference.

This appeal is from a judgment and a postjudgment award of attorney fees and costs in favor of Jeffrey Ketelhut and Marcella Ketelhut (the Ketelhuts) and other parties. The Ketelhuts cross-appeal from the award of attorney fees and costs. In the appeal from the judgment, the central issue is whether the Ketelhuts, homeowners in a residential common interest development, violated a restrictive covenant requiring that they not use their property for any business or commercial activity. The Ketelhuts operated a vineyard on their property. After harvesting the grapes, they sent them to a winery to be made into wine. They sold the wine over the Internet.

Other homeowners objected to the operation of what they considered to be a commercial vineyard in violation of the prohibition against any business or commercial activity. The Board of Directors (Board) of the homeowners association — Los Robles Hills Estates Homeowners Association (HOA) — decided that the vineyard was not being used for business or commercial activity.

Plaintiffs/homeowners Felipa Eith and Jeffrey Eith (the Eiths), Thomasine Mitchell and John Mitchell (the Mitchells), Stacy Wasserman, Philip Chang, Morrey Wasserman, and Eileen Gabler (hereafter collectively referred to as “plaintiffs”) brought an action against the Ketelhuts, HOA, and Board members Michael Daily, Jeanne Yen, and Frank Niesner (hereafter collectively referred to as “defendants”). The court conducted a lengthy bifurcated trial on the eighth and ninth causes of action. The eighth cause of action concerned whether the operation of the vineyard was a prohibited business or commercial activity. The ninth cause of action sought to quiet title to a common area.

The trial court did not decide whether the operation of the vineyard was a prohibited business or commercial activity. Instead, it invoked the judicial deference rule of Lamden, supra, 21 Cal.4th 249. Pursuant to this rule, the trial court deferred to the Board’s decision that the vineyard was not being used for business or commercial activity. The court entered judgment in favor of defendants on both the eighth and ninth causes of action. The resolution of these two causes of action rendered the remaining causes of action moot.

The trial court correctly applied the Lamden judicial deference rule to the Board’s decision that the Ketelhuts’ operation of the vineyard was not a prohibited business or commercial use. We further conclude that, as a matter of law, it is not a prohibited business or commercial use. In addition, we reject plaintiffs’ claim that the judgment is void because the trial judge did not disclose contributions made by defendants’ counsel to his campaign for re-election to the superior court. We affirm the judgment as well as the postjudgment award of attorney fees and costs.

Factual Background

In 1966, the Janss Corporation (Janss) developed a 28-lot residential subdivision (Los Robles Hills Estates) in the City of Thousand Oaks. The subdivision is a common interest development subject to the Davis-Sterling Common Interest Development Act. (Civ. Code, § 4000 et seq.) “Common interest developments are required to be managed by a homeowners association [citation], defined as `a nonprofit corporation or unincorporated association created for the purpose of managing a common interest development’ [citation], which homeowners are generally mandated to join [citation].” (Villa De Las Palmas Homeowners Assn. v. Terifaj (2004) 33 Cal.4th 73, 81.)

Janss created HOA to manage the development. It deeded to HOA an 18.56-acre parcel that the trial court and parties referred to as a “common area.” The deed provides, “This conveyance is made on condition that said property shall be used solely for purposes of recreation or decoration or both, and in the event that said property is otherwise used, it shall automatically revert to grantor herein.”

The development is subject to a recorded declaration of CC&Rs. Paragraph 1.01 of the CC&Rs provides, “No lot shall be used for any purpose (including any business or commercial activity) other than for the residence of one family and its domestic servants. . . .” Subparagraph 3 of paragraph 2.03 provides that “[f]or good cause shown . . . deviations from the applicable deed restrictions” may be allowed “to avoid unnecessary hardships or expense, but no deviation shall be allowed to authorize a business or commercial use.” Paragraph 5.07 provides, “Every person acquiring a lot . . . covenants to observe, perform and be bound by this Declaration of Restrictions.”

In June 2003, the Ketelhuts purchased in the development a 1.75-acre lot on Pinecrest Drive (the Property). In 2005, they planted a vineyard consisting of 600 plants. The plants extended “just under .4 acres” into the 18.56-acre common area. In their brief, defendants acknowledge, “Unbeknownst to the Ketelhuts and [HOA], some of the grape plants encroached on the [common area].” In 2011, when HOA learned of the encroachment, its counsel wrote a letter to the Ketelhuts’ counsel “demanding that [the Ketelhuts] immediately remove the vines from the common area, as well as any other items that may be located upon the Association’s common area.”

Before planting the grape vines, the Ketelhuts submitted a landscape plan (Exhibit 244) to the Board. It was approved by the Board’s Architectural Committee (the Committee). The plan divided the Property into three separate vineyards. One would grow grapes for Cabernet Sauvignon, the second for Sangiovese, and the third for Merlot. The plan did not indicate the number of grape vines that would be planted. The Ketelhuts did not inform the Board or the Committee that the grapes grown on the Property would be used to make wine that would be offered for sale to the public.

Pranas Raulinaitis, who served on the Committee in 2005, testified that the Committee members “viewed the [vineyard] as an amazing [aesthetic] enhancement to the neighborhood.” It “never entered into [his] mind” that “the vineyard was being planted for commercial sale of wine to the public.”

The first harvest was in 2008. At that time, Jeffrey Ketelhut “harvested the grapes . . . with the intention of bottling them for sale.” He “commenc[ed the] wine business in 2009.” Jeffrey Ketelhut admitted that “the sale[] of wine is a business” and that the vineyard “operates like a business.” But he characterized the vineyard “as a hobby where I do it in my spare time.” “[M]y purpose in getting involved wasn’t to generate a profit and this become a livelihood. This was a hobby. I enjoy gardening. . . . [T]hat was therapy for me.” The Ketelhuts never determined whether, excluding attorney fees, the vineyard generated a profit. Including attorney fees, it has not generated a profit in any year.

Although the Ketelhuts’ tax returns were not produced, Jeffrey Ketelhut testified that he had filed Internal Revenue Service Schedule C (Form 1040) for the vineyard. Pursuant to Evidence Code sections 459 and 452, subdivision (h), we take judicial notice that Schedule C is entitled “Profit or Loss from Business (Sole Proprietor).” We also take judicial notice that, since 2009, page 1 of the instructions for Schedule C has provided, “Use [Schedule C (Form 1040)] to report income or loss from a business you operated or a profession you practiced as a sole proprietor. An activity qualifies as a business if: your primary purpose for engaging in the activity is for income or profit, and you are involved in the activity with continuity and regularity. For example, a sporadic activity or a hobby does not qualify as a business.” (Italics added.)

In 2009, the Ketelhuts filed in Ventura County a fictitious business name statement showing that they were doing business at the Property as “Los Robles Hills Winery” and “Puerta del Cielo Vineyards.” They applied and obtained a “Type 17 and Type 20 license [from the Department of Alcoholic Beverage Control], which [permits] retail and wholesale [sales] over the internet only.” They also obtained “a Thousand Oaks business license.” The licenses showed that the business was located at the Property. But in 2012, the location of the business was changed to a Camarillo address.

The Ketelhuts began selling wine in May 2010. With one exception, they have sold only wine made from grapes grown on the Property. The exception occurred in 2011, when they made wine from sauvignon blanc grapes that they had purchased. In 2015, the Ketelhuts harvested 2,000 pounds of grapes. They invited family, friends, and neighbors to participate in the harvesting. Jeffrey Ketelhut testified, “[I]t took us an hour-and-a-half to pull down all the grapes.”

After the grapes are harvested, they are transported to “Camarillo Custom Crush [in Camarillo], where all the winemaking takes place.” Camarillo Custom Crush puts the wine into bottles that bear the Ketelhuts’ personal label. The Ketelhuts do not store wine on the Property. They have a storage facility in Malibu. They do not ship bottles of wine from the Property.

“In a typical year,” the Ketelhuts are “fortunate” to produce two barrels of wine. “[A] single barrel can hold up to 30 cases.” Each case contains 12 bottles. Thus, the maximum typical annual production is 720 bottles of wine. But in 2009, the Ketelhuts “produced 132 cases,” which is 1,584 bottles of wine.

At the time of trial in November 2015, the wine production was “dwindling” because they had “los[t] vines [due] to drought.” The original 600 plants had been reduced to about 400. Jeffrey Ketelhut estimated that production for 2014 and 2015 would be 50 cases per year. The wine for these years was still being stored in barrels.

The Ketelhuts retain ownership of the bottled wine. They advertise on Facebook, Twitter, their personal web site, “and through [their] wholesale accounts.” The logo “Los Robles Hills Winery” and their website address are displayed on the exterior of their truck, which they park in the driveway of the Property. “[T]hey keep the truck covered” while it is on the Property.

The Ketelhuts “sold wine to a number of restaurants and hotels in the local area.” But because of plaintiffs’ lawsuit, they “let those [local sales] lapse.” At the time of trial, they were “still offer[ing] retail sales and wholesale sales,” but were probably giving “at least 60 percent” of their wine to “charity.” For the last two years, their retail sales have been “zero.” Their wines appear on the menu at “a few” restaurants.

Exhibit No. 35 contains copies of pages from the Ketelhuts’ web site. The pages are dated May 22, 2014. The wines for sale range in price from $27 to $42 per bottle.

In January 2011, the Ventura County Star published an article about the Ketelhuts'”winery.” The article said that they “were hosting wine tastings by appointment at [their] home tasting room.” In March 2011, the Department of Alcoholic Beverage Control informed the Ketelhuts that someone had complained about the wine tastings. The Ketelhuts denied hosting wine tastings on the Property.

In its statement of decision, the trial court found: “There was . . . no retail traffic to the premises or tasting room on the premises at [the Property]. What was accomplished [there] was cultivation of the grapes, picking of the grapes, and transportation of the grapes to Camarillo.”

Some homeowners complained about the vineyard. In August 2011 counsel for plaintiffs Felipa Eith and Stacy Wasserman wrote a letter to the Ketelhuts “indicating that the commercial vineyard was a violation of the CC&Rs and that [they] should stop that aspect of [their] business.” The letter did not demand that the Ketelhuts stop growing grapes on the Property. It demanded that they “[c]ease operating a commercial vineyard.” The letter also demanded that the Ketelhuts “[r]emove all encroaching plants, irrigation and any other vineyard materials . . . from the . . . common area.”

The Board, which consisted of five homeowners, investigated the Ketelhuts’ operation of the vineyard. It interviewed other homeowners. In June 2011, it conducted a meeting that was open to all of the homeowners. The Ketelhuts appeared and answered questions. After the meeting, three of the five board members — defendants Daily, Yen, and Niesner — concluded that the Ketelhuts were not using the Property for a nonresidential purpose in violation of paragraph 1.01 of the CC&Rs. They found that there was no prohibited business or commercial activity on the Property.

Board member Daily considered the vineyard to be “landscaping” rather than a business. He explained: “They were growing grape vines just like I grow fruit trees and Mr. Krupnick [a homeowner] grows avocado trees, and people grow grass in their yard. It was landscape.” “[T]herefore I wasn’t going to, as a board member, try to restrict them from growing grapes. Like I wouldn’t restrict anybody else from growing fruit or whatever.” “Their growing grapes was part of their landscape plan.”

On the other hand, Daily understood that “the growing phase of their winery was part of the business.” “You have to have grapes in order to make wine.” Daily continued: “I believe that aspect to their business [growing grapes] is acceptable because it’s their landscape.” “The growing of grapes is certainly not something prohibited by the CC&R’S and if somebody takes those grapes in a very limited way without impact on the community, then I don’t really care what they do with them. They can make jelly and sell it. That’s fine with me.” “I considered that [the Ketelhuts] were going to do something that was not going to have a negative impact on the community and therefore it was allowable.”

Daily did not “know how to define the difference between business and commercial” activity. He said: “[W]hen I think of commercial activity, I think of something, you know, in a building, you know, off site. That’s what I think of as commercial activity.”

Board member Yen testified that “commercial activity” within the meaning of the CC&Rs “is something that would cause a stress in the community, whether it be traffic, whether it be individuals, that it’s something that disrupts our quality in our community and impacts your neighbors. That’s commercial activity.” Yen did “not see picking grapes to go to Custom Crush [a]s impairing any activities in the community or in any way creating blockage to the community or a problem for the community.”

Procedural Background

Plaintiffs filed a complaint consisting of nine causes of action. The trial court bifurcated the eighth and ninth causes of action and tried them first. The trial began in July 2015 and ended in November 2015.

The eighth cause of action is against HOA and the Ketelhuts. It seeks declaratory and injunctive relief. It requests “a judicial determination and decree that the CC&Rs and Grant Deed prohibit” the Ketelhuts from (1) operating their “Business” and “commercial enterprise,” including the vineyard, on the Property and the common area, and (2) encroaching on the common area. The eighth cause of action also requests the issuance of a permanent injunction prohibiting the Ketelhuts from operating their business on the Property and encroaching on the common area.

The ninth cause of action is against all defendants. It seeks to quiet title to the common area. It claims that each of the 28 lot owners has an undivided 1/28th ownership interest in the common area and is “entitled to the non-exclusive possession” of that area. The ninth cause of action sought a judicial declaration that HOA has “no estate, right, title or interest” in the common area.

The remaining seven causes of action are for nuisance; trespass; breach of the CC&Rs; breach of HOA’s fiduciary duty; breach of fiduciary duty by Board members; and “willful, wanton misfeasance and gross negligence.” In its statement of decision, the trial court said it had ordered that “[t]he remaining causes of action, for which a jury had been demanded, would be set for trial as may be necessary following determination of the Declaratory Relief and Quiet Title causes of actions.”

Prior to trial on the eighth and ninth causes of action, all plaintiffs except Felipa Eith dismissed the entire action against HOA and Board members.

Statement of Decision

On the eighth cause of action for declaratory and injunctive relief, in its statement of decision, the trial court said that it was “faced with . . . whether or not to exercise its independent analysis of whether or not what the Ketelhuts were doing is a business or commercial activity, or to determine if the HOA had the discretionary authority to allow the Ketelhuts to do what they did under what is commonly known as the business judgment rule.” The court applied the “deferential business judgment standard adopted by [Lamden, supra, 21 Cal.4th 249].”

The trial court ruled: “The Court finds here that the defendant HOA and its individual directors acted in good faith in addressing the activities of the defendants Ketelhut, and that this decision should not be re-examined within the context of this litigation. . . . As noted in Beehan v. Lido Isle (1977) 70 Cal.App.3d 858 @ 865, `The board of directors may make incorrect decisions, as well as correct ones, so long as it is faithful to the corporation and uses its best judgment.’ . . . The Court finds that this board of directors used it[s] best judgment and acted in a reasonable manner under the circumstances presented to it. As such, the Court does not grant the relief that plaintiffs seek, but finds in favor of the defendants on the cause of action for declaratory relief.” (Italics added.)

On the ninth cause of action to quiet title to the common area, the trial court found that the area was deeded to HOA in 1966. “[N]o fractional interest in the property was deeded to any homeowners. Since that time, there have been no other documents, recorded or otherwise, that purport[] to grant to the homeowners the 1/28 fractional interest that they are seeking in this action.” Therefore, “title to the 18.5 acre common area is confirmed and quieted to [HOA].”

Judgment

On the eighth and ninth causes of action, the trial court entered judgment in favor of defendants. The judgment does not mention the remaining seven causes of action. In its statement of decision, the trial court said, “The rulings here made moot plaintiffs[‘] remaining causes of action. The case is therefore not set for further trial on those issues.”

Thus, the judgment disposed of all nine causes of action and is appealable under the one final judgment rule of Code of Civil Procedure section 904.1, subdivision (a). “Judgments that leave nothing to be decided between one or more parties and their adversaries . . . have the finality required by section 904.1, subdivision (a). A judgment that disposes of fewer than all of the causes of action framed by the pleadings, however, is necessarily `interlocutory’ (Code Civ. Proc., § 904.1, subd. (a)), and not yet final, as to any parties between whom another cause of action remains pending.” (Morehart v. County of Santa Barbara (1994) 7 Cal.4th 725, 741.)

PLAINTIFFS’ APPEAL

The Judgment Is Not Void Because of the Trial Judge’s Alleged Disqualification

A. Factual and Procedural Background

The complaint was filed on August 31, 2011. The case was assigned to Judge Henry J. Walsh.

After a contested judicial election, Judge Walsh was reelected in 2012. On February 10, 2016, the Commission on Judicial Performance admonished Judge Walsh for failing to disclose contributions made to his 2012 campaign by attorneys who had appeared before him after the election. The Commission noted, “In 2010, effective January 1, 2011, subdivision (a)(9)(C) was added to Code of Civil Procedure section 170.1 to require judges to disclose campaign contributions of $100 or more.”

On the same day that Judge Walsh was admonished, he signed the judgment in the instant case.[1] The next day, plaintiff Felipa Eith filed a request for a stay of all further action by Judge Walsh pending a hearing on a not yet filed motion to disqualify him.

On March 2, 2016, Felipa Eith filed a motion to disqualify Judge Walsh for cause pursuant to Code of Civil Procedure section 170.1. The ground for the motion was that he had received campaign contributions from defendants’ counsel and had not disclosed them to plaintiffs. Eith alleged, “Recent inspection of recorded and filed election documents (Form 460) establishes that during the pendency of the instant action Judge Walsh solicited, accepted and kept secret from Plaintiffs and plaintiffs’ counsel, monetary contributions to his campaign from defense counsel [firm partners, or staff attorneys] in the amount of $2,600.00….” (Brackets in original.) A minute order entered nine days later on March 11, 2016, states: “Without conceding the merit of allegations of prejudice made by Ms. Eith, the court recuses itself from the case, and refers it to the supervising civil judge for re-assignment.”

Plaintiffs filed a motion for a new trial. They argued that Judge Walsh’s failure to disclose the campaign contributions denied them their right to a fair trial. Plaintiffs claimed that, if Judge Walsh had made a timely disclosure, they “would certainly have sought his disqualification in 2012 to preclude the possibility that he would preside at trial.”

Judge John Nho Trong Nguyen denied the motion for a new trial. He ruled, “When the facts are viewed as a whole they show that no person aware of them might reasonably entertain a doubt that Judge Walsh would be able to be impartial.”

B. Analysis

Plaintiffs argue that the judgment is void because Judge Walsh was disqualified years before the trial when he failed to disclose contributions made by defendants’ counsel. If Judge Walsh were so disqualified, the judgment would be void. In Christie v. City of El Centro (2006) 135 Cal.App.4th 767, 776, the court “conclude[d] that because [the trial judge] was disqualified at the time he granted the City’s motion for nonsuit, that ruling was null and void and must be vacated regardless of a showing of prejudice.” The court rejected the City’s claim “that the grant of nonsuit need not be overturned because [the judge] was not disqualified until later” when a motion to disqualify him was granted: “[D]isqualification occurs when the facts creating disqualification arise, not when disqualification is established. [Citations.] The acts of a judge subject to disqualification are void or, according to some authorities, voidable. [Citations.] Relief is available to a party who, with due diligence, discovers the grounds for disqualification only after judgment is entered or appeal filed. [Citations.] Although a party has an obligation to act diligently, he or she is not required to launch a search to discover information that a judicial officer should have disclosed. [Citations.]” (Id. at pp. 776-777.)

The relevant statute is Code of Civil Procedure section 170.1, subdivision (a)(9), which provides: “A judge shall be disqualified” if: “(A) The judge has received a contribution in excess of one thousand five hundred dollars ($1500) from a party or lawyer in the proceeding, and either of the following applies: [¶] (i) The contribution was received in support of the judge’s last election, if the last election was within the last six years. [¶] (ii) The contribution was received in anticipation of an upcoming election. [¶] (B) Notwithstanding subparagraph (A), the judge shall be disqualified based on a contribution of a lesser amount if subparagraph (A) of paragraph (6) applies.” (Italics added.) Subparagraph (A) of paragraph (6) provides that a judge shall be disqualified if “[f]or any reason: [¶] (i) The judge believes his or her recusal would further the interests of justice. [¶] (ii) The judge believes there is a substantial doubt as to his or her capacity to be impartial. [¶] (iii) A person aware of the facts might reasonably entertain a doubt that the judge would be able to be impartial.” (Italics added.)

The California Supreme Court Committee on Judicial Ethics Opinions (CJEO) issued an opinion on mandatory disqualification based on a contribution of more than $1,500: CJEO Formal Opinion 2013-003 (http://www.judicialethicsopinions.ca.gov/wp-content/uploads/cjeo_ formal_opinion_2013-003.pdf). CJEO concluded, and we agree, that the $1,500 disqualification threshhold “applies to the individual lawyer appearing in the matter.” (Id. at p. 11.) “[T]he Legislature did not intend the $1,500 threshold for disqualification to apply to aggregated contributions from multiple individuals from the same law firm, nor to all individuals practicing law in a contributing law firm. A judge receiving such contributions however, is also required to make a determination as to whether disqualification is called for under section 170.1, subdivision (a)(6)[A](iii) and [(a)](9)(B).” (Ibid.) “[M]andatory disqualification for individual attorney contributions over the $1,500 threshold, together with discretionary disqualification for aggregated and law firm contributions, sufficiently ensures the public trust in an impartial and honorable judiciary.” (Ibid.)

In their opening briefs, plaintiffs list the contributions of all of the lawyers who allegedly represented defendants during the five years of litigation. No lawyer contributed more than $1,500 to Judge Walsh’s campaign. Thus, the mandatory disqualification provision is inapplicable. (Code Civ. Proc., § 170.1, subd. (a)(9)(A).)

Plaintiffs have failed to show that Judge Walsh was disqualified because “[a] person aware of the facts might reasonably entertain a doubt that [he] would be able to be impartial.” (Code Civ. Proc., § 170.1, subd. (a)(6)(A)(iii).) Thus, we reject plaintiffs’ claim that Judge Nguyen abused his discretion in denying their motion for a new trial. (See Garcia v. Rehrig International, Inc. (2002) 99 Cal.App.4th 869, 874 [“`”`The determination of a motion for a new trial rests so completely within the court’s discretion that its action will not be disturbed unless a manifest and unmistakable abuse of discretion clearly appears'”‘”]; Boyle v. CertainTeed Corp.(2006) 137 Cal.App.4th 645, 649-650 [“an appealed judgment is presumed correct, and plaintiff bears the burden of overcoming the presumption of correctness”].)

[[Plaintiffs Were Not Denied Their Right to a Jury Trial

Plaintiffs argue that the trial court’s bifurcation of the eighth cause of action denied them their right to a jury trial on the legal issue of whether the Ketelhuts were using the Property for a business or commercial purpose in violation of the CC&Rs. “The issue of whether [plaintiffs were] `constitutionally entitled to a jury trial . . . is a pure question of law that we review de novo.’ [Citations.]” (Entin v. Superior Court(2012) 208 Cal.App.4th 770, 776.)

“As a general proposition, `[T]he jury trial is a matter of right in a civil action at law, but not in equity.’ [Citations.] [¶]. . . `”If the action has to deal with ordinary common-law rights cognizable in courts of law, it is to that extent an action at law. In determining whether the action was one triable by a jury at common law, the court is not bound by the form of the action but rather by the nature of the rights involved and the facts of the particular case — the gist of the action. A jury trial must be granted where the gist of the action is legal, where the action is in reality cognizable at law.”‘ [Citation.] On the other hand, if the action is essentially one in equity and the relief sought `depends upon the application of equitable doctrines,’ the parties are not entitled to a jury trial. [Citations.]” (C & K Engineering Contractors v. Amber Steel Co. (1978) 23 Cal.3d 1, 8-9.)

The gist of the eighth cause of action is the request for “a permanent injunction compelling [the Ketelhuts] . . . from encroaching on the Common Area . . . and from conducting the Subject Business [a commercial vineyard] on the Subject Lot in violation of the restrictions set forth in the [CC&Rs].” Such relief is available only in equity. “A permanent injunction is an equitable remedy for certain torts or wrongful acts of a defendant where a damage remedy is inadequate.” (Art Movers, Inc. v. Ni West, Inc. (1992) 3 Cal.App.4th 640, 646.)

Thus, the bifurcation of the eighth cause of action and the trial of that action by the court did not deny plaintiffs their right to a jury trial. “It is well established that, in a case involving both legal and equitable issues, the trial court may proceed to try the equitable issues first, without a jury . . ., and that if the court’s determination of those issues is also dispositive of the legal issues, nothing further remains to be tried by a jury. [Citations.]” (Raedeke v. Gibraltar Sav. & Loan Assn. (1974) 10 Cal.3d 665, 671.)

Trial Court’s Orders Relieving Original Counsel from Further Representation and Denying Request for a Continuance

Attorney Michael T. Stoller originally represented plaintiffs Felipa Eith, Stacy Wasserman, Philip Chang, and the Mitchells. After the trial had begun, Stoller moved to be relieved as counsel of record because of “a non-waivable conflict” of interest. Stoller declared: “Based on the actual conflict, there has been an irreparable breakdown of the working relationship between counsel and client.” “The specific facts which give rise to this [conflict] are . . . required to be kept confidential.” The trial court granted the motion.

The next day, plaintiffs were not ready to proceed with the trial. Felipa Eith had unsuccessfully tried to retain substitute counsel. The Mitchells had retained substitute counsel, but he was not ready to proceed. Wasserman had also retained substitute counsel, but he was neither ready nor present in court. Chang was unrepresented.

The trial court denied Felipa Eith’s and the Mitchells’ request for a continuance. The trial resumed with the cross-examination of Chang by counsel for the Ketelhuts and counsel for HOA. Felipa Eith, a licensed attorney, frequently objected to counsels’ questions. After the cross-examination of Chang, Eith called John Mitchell as a witness and examined him. On the next day of trial — August 18, 2015 — no testimony was taken. The court continued the matter to October 26, 2015.

The Eiths contend that the trial court erroneously granted Stoller’s request to be relieved as counsel. They claim that the court “failed to undertake its duty of inquiry” and “duty to explore the conflict.” The claim is forfeited because it is not supported by meaningful legal analysis with citations to the record and pertinent authority. (In re S.C. (2006) 138 Cal.App.4th 396, 408.) The only authority they cite — Aceves v. Superior Court (1996) 51 Cal.App.4th 584, 592-593 — is a criminal case. There, the court noted that “case law ties the duty of inquiry to the duty of the trial court to ensure the `”trial is conducted with solicitude for the rights of the accused”‘ and to `”protect the right of the accused to have the assistance of counsel.”‘ [Citation.]” (Id. at p. 593.) These rights are not implicated in the instant civil action.

In any event, even if the trial court had erred, the Eiths have not shown that they were prejudiced. (See Freeman v. Sullivant (2011) 192 Cal.App.4th 523, 527 [“A judgment is reversible only if any error or irregularity in the underlying proceeding was prejudicial”]; In re S.C., supra, 138 Cal.App.4th at p. 407 [“appellant cannot prevail without establishing that she was prejudiced by the alleged error”].)

The Eiths and other plaintiffs argue that the trial court abused its discretion in resuming Chang’s cross-examination without granting their request for a continuance. Plaintiffs have “not attempted to show [they were] prejudiced by the denial of a continuance. . . . Therefore, [they have] not met [their] burden on appeal, and any argument that the failure to grant the requested continuance constituted reversible error is deemed waived. [Citation.]” (Freeman v. Sullivant, supra, 192 Cal.App.4th at p. 528.)[2]]]

The Trial Court Properly Applied the Judicial Deference Rule Adopted by Our Supreme Court in Lamden

In its statement of decision, the trial court applied the rule of judicial deference adopted by our Supreme Court in Lamden, supra, 21 Cal.4th 249. The plaintiff homeowner in Lamden complained that a condominium development’s community association had wrongly decided to treat a termite infestation “locally (`spot treat’).” (Id. at p. 252.) The plaintiff wanted the association to fumigate the building. The Supreme Court stated, “[W]e adopt today for California courts a rule of judicial deference to community association board decisionmaking that applies . . . when owners in common interest developments seek to litigate ordinary maintenance decisions entrusted to the discretion of their associations’ boards of directors. [Citation.]” (Id. at p. 253.) The rule is as follows: “Where a duly constituted community association board, upon reasonable investigation, in good faith and with regard for the best interests of the community association and its members, exercises discretion within the scope of its authority under relevant statutes, covenants and restrictions to select among means for discharging an obligation to maintain and repair a development’s common areas, courts should defer to the board’s authority and presumed expertise.” (Ibid.)

The Supreme Court explained: “The formulation we have articulated affords homeowners, community associations, courts and advocates a clear standard for judicial review of discretionary economic decisions by community association boards, mandating a degree of deference to the latter’s business judgments sufficient to discourage meritless litigation. . . . [¶] Common sense suggests that judicial deference in such cases as this is appropriate, in view of the relative competence, over that of courts, possessed by owners and directors of common interest developments to make the detailed and peculiar economic decisions necessary in the maintenance of those developments. A deferential standard will, by minimizing the likelihood of unproductive litigation over their governing associations’ discretionary economic decisions, foster stability, certainty and predictability in the governance and management of common interest developments.” (Lamden, supra, 21 Cal.4th at pp. 270-271.)

Some courts have narrowly construed the Lamden rule. In Affan v. Portofino Cove Homeowners Assn. (2010) 189 Cal.App.4th 930, 940, the court observed: “It is important to note the narrow scope of the Lamden rule. It is a rule of deference to the reasoned decisionmaking of homeowners association boards concerning ordinary maintenance. . . . The Supreme Court’s precise articulation of the rule makes clear that the rule of deference applies only when a homeowner sues an association over a maintenance decision that meets the enumerated criteria. [Citations.]” (See also Ritter & Ritter, Inc. v. The Churchill Condominium Assn.(2008) 166 Cal.App.4th 103, 122.)

Most courts have broadly construed the Lamden rule. In Haley v. Casa Del Rey Homeowners Assn. (2007) 153 Cal.App.4th 863, 875 (Haley), the court concluded that Lamden “reasonably stands for the proposition that the Association had discretion to select among means for remedying violations of the CC&R’s without resorting to expensive and time-consuming litigation, and the courts should defer to that discretion.”

In Harvey v. The Landing Homeowners Assn. (2008) 162 Cal.App.4th 809, 820 (Harvey), the CC&Rs allowed the board “to designate storage areas in the common area.” They also gave the board “the exclusive right to manage, operate and control the common areas.” (Ibid.) The court held, “Under the `rule of judicial deference’ adopted by the court in Lamden, we defer to the Board’s authority and presumed expertise regarding its sole and exclusive right to maintain, control and manage the common areas when it granted the fourth floor homeowners the right, under certain conditions, to use up to 120 square feet of inaccessible attic space common area for rough storage.” (Id. at p. 821.)

In Watts v. Oak Shores Community Association (2015) 235 Cal.App.4th 466, 473 (Watts), this court rejected the plaintiffs’ claim “that the rule applying judicial deference to association decisions applies only to ordinary maintenance decisions.” We reasoned: “It is true the facts in Lamden involve the association board’s decision to treat termites locally rather than fumigate. But nothing in Lamden limits judicial deference to maintenance decisions.” (Ibid.) “[T]here is no reason to read Lamden so narrowly.” (Ibid.) “Common interest developments are best operated by the board of directors, not the courts.” (Ibid.) We applied the judicial deference rule to the board’s adoption of rules and imposition of fees relating to short-term rentals of condominium units. We noted that, in Dolan-King v. Rancho Santa Fe Assn. (2000) 81 Cal.App.4th 965, 979 (Dolan-King), “the court gave deference to an association board’s decision denying an owner’s application for a room addition on aesthetic grounds.” (Watts, supra, 235 Cal.App.4th at p. 473.)

Based on Lamden, Haley, Harvey, Watts, and Dolan-King, the judicial deference rule applies to an association board’s discretionary decisions concerning the operation of the common interest development, e.g., the board’s maintenance and repair decisions (Lamden), its selection of the appropriate means to remedy a violation of the CC&Rs (Haley), its designation of storage space in a common area (Harvey), its adoption of rules relating to short-term rentals (Watts), or its approval or rejection of a homeowner’s improvement plan (Dolan-King). As we observed in Watts, “Common interest developments are best operated by the board of directors, not the courts.” (Watts, supra, 235 Cal.App.4th at p. 473.)

Here, the Board made a decision concerning the operation of the common interest development. The Board decided whether the Ketelhuts violated the CC&Rs’ prohibition against the use of the Property for business or commercial activity. The Board reasoned that the CC&Rs’ prohibition did not encompass the operation of the vineyard because it did not affect the residential character of the community. Board member Daily testified, “I considered that [the Ketelhuts] were going to do something that was not going to have a negative impact on the community and therefore it was allowable.” Board member Yen did “not see picking grapes to go to Custom Crush [a]s impairing any activities in the community or in any way creating blockage to the community or a problem for the community.”

We do not defer to the Board’s interpretation of the CC&Rs. The interpretation of CC&R’s is a legal question to be decided by the courts, not the Board. “CC&R’s are interpreted according to the usual rules for the interpretation of contracts generally, with a view toward enforcing the reasonable intent of the parties. [Citations.]” (Harvey, supra, 162 Cal.App.4th at p. 817.) “`”[N]ormally the meaning of contract language . . . is a legal question.” [Citation.] “Where, as here, no conflicting parol evidence is introduced concerning the interpretation of the document, `construction of the instrument is a question of law, and the appellate court will independently construe the writing.'” [Citation.]'” (Cohen v. Five Brooks Stable (2008) 159 Cal.App.4th 1476, 1483; see also Legendary Investors Group No. 1, LLC v. Niemann (2014) 224 Cal.App.4th 1407, 1413 [“contract interpretation is a legal question for the court”].)

In our review of the CC&Rs, we conclude that the Board correctly interpreted the prohibition of business or commercial activity. The prohibition does not encompass activity that has no effect on the community’s residential character. The purpose of the prohibition is to preserve the community’s residential character.

The trial court properly deferred to the Board’s discretionary decision that the Ketelhuts’ operation of the vineyard did not violate the prohibition against business or commercial activity because it did not affect the community’s residential character. The Board made its decision “upon reasonable investigation, in good faith and with regard for the best interests of the community association and its members.” (Lamden, supra, 21 Cal.4th at p. 253.). The Board interviewed homeowners and conducted a public hearing at which the Ketelhuts answered questions. Yen testified that the Board’s decision was “based on our looking at it from the scope of the community: Is it creating any stress for the community, is it impairing the community’s functioning, is it invasive to the community, and have we received any complaints regarding what is happening.” “Our decision and focus of discussion was on the impact o[n] the community.”

“Common sense suggests that judicial deference in such cases as this is appropriate, in view of the relative competence, over that of courts, possessed by owners and directors of common interest developments. . . .” (Lamden, supra, 21 Cal.4th at p. 270.) The Board members lived in the community and had discussed the Ketelhuts’ vineyard with other homeowners. They were in a much better position than the courts to evaluate the vineyard’s effect on the community. We “should defer to the [B]oard’s authority and presumed expertise.” (Id. at p. 265.)

The Board Correctly Decided that the Operation of the Vineyard Is Not Prohibited Business or Commercial Activity

As an alternative holding, we conclude that as a matter of law, the Ketelhuts’ operation of the vineyard is not prohibited business or commercial activity because it does not affect the community’s residential character.

No signs advertising wine sales are posted on the Property. Although the Ketelhuts’ logo “Los Robles Hills Winery” and their website address are displayed on the exterior of their truck, “they keep the truck covered” while it is on the Property. The wine is made and bottled in Camarillo. The bottled wine is stored in Malibu. It is not shipped from the Property. The trial court found that there is “no retail traffic” to the Property, which does not have a wine-tasting room. The court said, “What was accomplished [on the Property] was cultivation of the grapes, picking of the grapes, and transportation of the grapes to Camarillo.”

Had the Ketelhuts retained the wine for their personal use or given it away to friends or charity, there would have been no basis for finding business or commercial activity. All activities relating to the vineyard would have been permissible. That the Ketelhuts offered the wine for sale over the Internet did not transform their use of the Property into prohibited business or commercial activity. At all times the operation of the vineyard was fully consistent with residential use. No homeowner familiar with the vineyard’s operation would have had reason to suspect that the vineyard was being used to produce wine for sale to the public. The business or commercial activity of making and selling the wine did not occur on the Property. Board member Daily testified, “They were growing grape vines just like I grow fruit trees and Mr. Krupnick grows avocado trees, and people grow grass in their yard.” Moreover, instead of being a blight on the community, the vineyard was an aesthetic enhancement. Pranas Raulinaitis, who served on the Committee that approved the Ketelhut’s landscape plan in 2005, testified that the Committee members “viewed the [vineyard] as an amazing [aesthetic] enhancement to the neighborhood.”

We recognize that the growing of grapes on the Property is an integral part of the Ketelhuts’ winemaking business. As Daily testified, “You have to have grapes in order to make wine.” But absurd consequences would flow from construing the CC&Rs as prohibiting any business or commercial activity whatsoever irrespective of its effect on the residential character of the community.

For example, some appellate attorneys work at home, reading records, doing research, and writing briefs, but meet with clients elsewhere. Although these attorneys are engaged in the business of practicing appellate law at their home offices, their business activities do not affect the residential character of their communities.

It would be absurd to construe the CC&Rs as prohibiting such harmless conduct, just as it would be absurd to construe them as prohibiting the Ketelhuts from operating their vineyard. “`In construing a contract the court . . . should adopt that construction which will make the contract reasonable, fair and just [citation]; . . . [and] should avoid an interpretation which will make the contract . . . harsh, unjust or inequitable [citations], or which would result in an absurdity [citations]. . . .'” (Wright v. Coberly-West Co. (1967) 250 Cal.App.2d 31, 35-36.)

There will be instances, of course, where a homeowner’s activity constitutes prohibited business activity even though the business is primarily conducted off the residential premises. For example, if a homeowner conducted a trucking business off the premises except that the trucks were stored on the premises when not in use, the homeowner might be in violation of the business prohibition. The presence of the commercial trucks would detract from the community’s residential character. (See Smart v. Carpenter (N.M. Ct.App. 2006) 134 P.3d 811.)

The Ninth Cause of Action to Quiet Title

The Eiths argue that the trial court’s judgment is not supported by the law or the facts. It is not clear whether this argument applies solely to the eighth cause of action for declaratory and injunctive relief, or whether it also applies to the ninth cause of action to quiet title to the common area. If the argument applies to the ninth cause of action, it is forfeited because it is not supported by meaningful legal analysis with citations to the record and pertinent authority. (In re S.C., supra, 138 Cal.App.4th at p. 408.)

The Eiths contend that, on the ninth cause of action, “the trial court did not articulate in its decision (a) what if any legal or equitable rights each of the lot owners had in the 18 acres, nor did the court decide (b) whether or not the 18 acres is `common area’ as argued by [plaintiffs].” We disagree. In its statement of decision the trial court declared: “The common area of 18.56 acres is Common Interest land as defined by CCR Title 10, Chapter 6, Article 1, paragraph 2705.” “[T]itle to the 18.5 acre common area is confirmed and quieted to the defendant Homeowners Association.” The court rejected the complaint’s contention that the common area is “owned collectively by the twenty-eight (28) lot owners of the subdivision, each lot owner owning a 1/28 undivided interest in said property.”

Street Maintenance

The Eiths assert that “the trial court [err]ed in refusing to decide street maintenance obligations in the [common interest development].” In its statement of decision the trial court said it had “ruled before the presentation of evidence that the issue of the streets was not tendered by the pleadings or discovery and therefore would not be a subject for resolution at trial.” The Eiths have forfeited the issue because they have not presented meaningful legal analysis with supporting citations to the record and pertinent authority. (In re S.C., supra, 138 Cal.App.4th at p. 408.)

The Kettlehuts’ Encroachment on the Common Area

The Eiths claim that the trial court erred in “refusing to decide if the Ketelhut vineyard encroached on . . . common area.” The court decided this issue. In its statement of decision the court found, “[S]tarting in January of 2005, [Jeffrey Ketelhut] planted 600 grape vines on his property and extending into the 18.5 acre common area at the rear of [] his property by just under .4 acres.” In any event, it is undisputed that the Ketelhuts encroached on the common area. In their brief defendants acknowledge, “Unbeknownst to the Ketelhuts and [HOA], some of the [Ketelhuts’] grape plants encroached on the 18-acre parcel owned by the Association.”

Denial of Plaintiffs’ Motion to Disqualify HOA’s Counsel

The Eiths maintain that the trial court erroneously denied plaintiffs’ motion to disqualify HOA’s counsel. The issue is forfeited because the Eiths have failed to present meaningful legal analysis with supporting citations to the record and authority. (In re S.C., supra, 138 Cal.App.4th at p. 408.)

Plaintiffs’ Appeal from Award of Attorney Fees

“In an action to enforce the governing documents [of a common interest development], the prevailing party shall be awarded reasonable attorney’s fees and costs.” (Civ. Code, § 5975, subd. (c).) Except for the Eiths, plaintiffs’ appeal from the award of attorney fees is based on their claim that the judgment in favor of defendants on the eighth cause of action must be reversed. Therefore, they assert that the award of attorney fees is “premature.” Because we are affirming the judgment, the award is not premature.

The Eiths present numerous grounds for reversing the award of attorney fees. They contend that defendants are not “true prevailing parties.” (Capitalization omitted.) The contention lacks merit because judgment was rendered in favor of defendants and against plaintiffs on both the eighth and ninth causes of action.

The Eiths argue that, because of Jeffrey Eith’s “bankruptcy filing” and the automatic stay triggered by that filing, it was “improper” to order him to pay attorney fees. “The automatic stay is self-executing, effective upon the filing of the bankruptcy petition. [Citations.] The automatic stay sweeps broadly, enjoining the commencement or continuation of any judicial . . . proceedings against the debtor. . . .” (In re Gruntz (9th Cir. 2000) 202 F.3d 1074, 1081.) The automatic stay argument is forfeited because it was not raised in the trial court. (In re Marriage of Moschetta (1994) 25 Cal.App.4th 1218, 1227 [“parties are not normally allowed to raise new issues on appeal [because] it is unfair to their opponents who did not have the opportunity to attack that theory factually or legally in the trial court”].)[3]

The Eiths remaining grounds for contesting the award of attorney fees are rejected for lack of meaningful legal analysis with supporting citations to the record and pertinent authority. (In re S.C., supra, 138 Cal.App.4th at p. 408.)

THE KETELHUTS’ CROSS-APPEAL FROM ORDER AWARDING ATTORNEY FEES

The Ketelhuts claim that they were entitled to attorney fees of $351,432.55. In their cross-appeal, the Ketelhuts argue that the trial court abused its discretion in reducing the fees to $250,506.50, a shortfall of $100,926.05.

Disallowance of Fees Paid to Prior Attorney

The $100,926.05 shortfall includes attorney fees of $75,930.05 paid by the Ketelhuts to their prior attorney, Myers, Widders, Gibson, Jones & Schneider, LLP (Myers, Widders). The fees are supported by Jeffrey Ketelhut’s declaration under penalty of perjury and Myers, Widders’ detailed billing statements (Exhibit B to the declaration). Each statement includes a description of the service performed, the date it was performed, the time expended, and the fee incurred for the service. There is no supporting declaration from Myers, Widders.

As to Jeffrey Ketelhut’s declaration, plaintiffs objected to the following statement: “My former attorneys of record submitted invoices to me for attorney fees incurred in the defense of myself and Marcella Ketelhut in the amount of $75,930.05. A true and correct copy of the original attorney bills is attached hereto as Exhibit `B.'” The ground for plaintiffs’ objection was that “Mr Ketelhut has no personal knowledge of the contents, authenticity, or originality of the billings he has attached as Exhibit B.”

As to the billing statements (Exhibit B), plaintiffs objected: “The contents of Exhibit B are unauthenticated hearsay, and lack any foundation for admissibility under any exception to the hearsay rule. Mr. Ketelhut . . . further [is] not a qualified witness with personal knowledge adequate to testify to the genuineness or authenticity or accuracy of any of the contents of Exhibit B, which are documents prepared by other persons and/or entities.”

The trial court sustained plaintiffs’ objections. It disallowed the fees in their entirety because they are “not properly established.” The court provided no further explanation for its ruling.

“`”`[A]n appellate court reviews any ruling by a trial court as to the admissibility of evidence for abuse of discretion.'” [Citation.]’ [Citation.] `The court’s “`discretion is only abused where there is a clear showing [it] exceeded the bounds of reason, all of the circumstances being considered.’ “[Citation.]’ [Citation.]” (Soto v. BorgWarner Morse TEC Inc. (2015) 239 Cal.App.4th 165, 199.) We also review for abuse of discretion a trial court’s decision to award or deny attorney fees. (Connerly v. State Personnel Bd. (2006) 37 Cal.4th 1169, 1175.)

The Ketelhuts contend that the billing statements were admissible pursuant to the following rule of Pacific Gas & Elec. Co. v. G. W. Thomas Drayage & Rigging Co.(1968) 69 Cal.2d 33, 42-43 (Pacific Gas): “Since invoices, bills, and receipts for [attorney fees] are hearsay, they are inadmissible independently to prove that liability for the [fees] was incurred, that payment was made, or that the charges were reasonable. [Citations.] If, however, a party testifies that he incurred or discharged a liability for [attorney fees], any of these documents may be admitted for the limited purpose of corroborating his testimony [citations], and if the charges were paid, the testimony and documents are evidence that the charges were reasonable. [Citations.]”

Because “there was testimony in the present case that the invoices had been paid,” the billing statements in Exhibit B were admissible to corroborate Jeffrey Ketelhut’s declaration that he had incurred liability for the attorney fees. (Pacific Gas, supra, 69 Cal.2d at p. 43.) They were also admissible to show that the fees were reasonable. (Ibid.)

But “[t]he individual items on the invoices . . . were [to be] read, not [only] to corroborate payment or the reasonableness of the charges, but to prove that [the claimed services] had actually been [performed]. No qualified witness was called to testify that the invoices accurately recorded the [services performed] by [Myers, Widders], and there was no other evidence as to what [services] were [performed]. This use of the invoices was [impermissible]. [Citations.] An invoice submitted by a third party is not admissible evidence on this issue [i.e., to prove that the services described in the invoice were actually performed] unless it can be admitted under some recognized exception to the hearsay rule.” (Pacific Gas, supra, 69 Cal.2d at p. 43.) “It might come in under the business records exception (Evid. Code, § 1271) if `. . . supported by the testimony of a witness qualified to testify as to its identity and the mode of its preparation.’ [Citation.]” (Id. at p. 43, fn. 10.)

In Pacific Gas the defendant damaged the plaintiff’s turbine. Plaintiff brought an action against defendant to recover its cost of repair. “To prove the amount of damages sustained, plaintiff presented invoices received from . . . [the] repairer of the turbine, the drafts by which plaintiff had remitted payment, and testimony that payment had been made.” (Pacific Gas, supra, 69 Cal.2d at p. 42.) Although the invoices were admissible to show the reasonableness of the charges for the repairs, they were not admissible “to prove that these specific repairs had actually been made.” (Id. at p. 43.)

Here, as in Pacific Gas, the billing statements from Myers, Widders were not admissible to show that the services described in the statements had actually been performed. No qualified witness testified as to the “identity and . . . mode of . . . preparation” of the statements. (Evid. Code, § 1271, subd. (c).) Accordingly, the trial court did not abuse its discretion in sustaining plaintiffs’ objections and concluding that the Ketelhuts’ claim for attorney fees billed by Myers, Widders had not been “properly established.”

McAllister v. George (1977) 73 Cal.App.3d 258, is distinguishable. There, the defendant argued that a bill for dental services had been properly excluded from evidence because it was hearsay. The appellate court rejected the defendant’s argument: “Plaintiff testified that the dental services were performed, that he received a bill for them, and that he paid the bill. It has been held that under such circumstances the bill, which ordinarily would constitute inadmissible hearsay, is nevertheless admissible for the limited purpose of corroborating plaintiff’s testimony and showing that the charges were reasonable. [Citations.]” (Id. at p. 263, italics added.) Here, in contrast, Jeffrey Ketelhut did not declare, and lacked the personal knowledge necessary to declare, that the numerous services described in the billing statements had actually been performed. For example, a statement dated August 31, 2011, billed the Ketelhuts for attorney conferences in which they had not participated. The Ketelhuts lacked personal knowledge whether these conferences had occurred. In his declaration Jeffrey Ketelhut said that Myers, Widders had “submitted invoices to [him] for attorneys fees incurred in the defense of [himself] and Marcella Ketelhut.” He did not say that Myers, Widders had actually performed the services described in the invoices. The Ketelhuts could have rectified the situation by submitting a supporting declaration from Myers, Widders.[4]

Disallowance of Attorney Fees for 2014 Motion (Morrey Wasserman and Eileen Gabler)

In March 2014, plaintiffs Morrey Wasserman and Eileen Gabler voluntarily dismissed themselves as parties to the action against the Ketelhuts. The Ketelhuts moved for an award of attorney fees against Wasserman and Gabler. In June 2014, the trial court granted the motion and awarded attorney fees of $156,614.47. Wasserman and Gabler appealed. In an unpublished opinion, we concluded that the award was premature. We reversed and “remanded with directions to defer ruling on [the Ketelhuts’] motion for attorney fees until after the litigation among the various parties has been resolved.” (Wasserman et al. v. Ketelhut et al. (Dec. 1, 2015, B258642) [nonpub. opn.].)

After judgment was rendered in favor of the Ketelhuts as to all of the parties, the Ketelhuts sought an award of attorney fees incurred in bringing their unsuccessful 2014 motion to recover attorney fees from Wasserman and Gabler. The trial court denied the request, characterizing the 2014 motion as a “failed motion[].” The Ketelhuts claim that the trial court abused its discretion because they were the prevailing party. We disagree. The Ketelhuts were not the prevailing party as to the 2014 motion because the order granting the motion was reversed on appeal.

Disallowance of Attorney Fees for 2013 Motion (Kelly Park)

Kelly Park was one of the original plaintiffs in the action against the Ketelhuts. In August 2013 she voluntarily dismissed herself as a party to the action against the Ketelhuts. In November 2013 the trial court denied the Ketelhuts’ motion for an award of attorney fees against Park.

The Ketelhuts assert: “[They] are not appealing the trial court’s 2013 denial of their attorneys fee motion against Kelly Park. [They] are appealing the July 28, 2016 Order reducing [their] fee award by amounts incurred in preparing that 2013 motion.” The trial court said that it had reduced the Ketelhuts’ attorney fees for “the time spent on the failed motion[] for attorney’s fees against Kelly Park.” The trial court did not abuse its discretion because the Ketelhuts were not the prevailing party on the 2013 motion.]]

Disposition

The judgment and postjudgment award of attorney fees and costs are affirmed. The parties shall bear their own costs on appeal.

PERREN, J., concur.

PERREN, J., concur.

In a vain effort to “define what may be indefinable,” Justice Potter Stewart opined, “I know it when I see it.”[5] In like manner, the dissent “knows unfairness when [it] sees it” — when it sees how the Ketelhuts harvest their grapes and make and sell their wine. The majority sees it otherwise. In my opinion this is not a matter for such subjectivity. Rather, we should defer to the good faith exercise of discretion and “the board’s authority and presumed expertise.” (Maj. opn. ante, at pp. 22-23, citing Lamden v. La Jolla Shores Clubdominum Homeowners Assn. (1999) 21 Cal.4th 249, 265.)

Both the majority and the dissent appeal to “Common sense.” (Maj. opn. ante, at p. 22; dis. opn. post, at p. 3.) In doing so they quote from Lamden: I join with them and set forth the full closing of that opinion:

“Common sense suggests that judicial deference in such cases as this is appropriate, in view of the relative competence, over that of courts, possessed by owners and directors of common interest developments to make the detailed and peculiar economic decisions necessary in the maintenance of those developments. A deferential standard will, by minimizing the likelihood of unproductive litigation over their governing associations’ discretionary economic decisions, foster stability, certainty and predictability in the governance and management of common interest developments. Beneficial corollaries include enhancement of the incentives for essential voluntary owner participation in common interest development governance and conservation of scarce judicial resources.” (Lamden v. La Jolla Shores Clubdominum Homeowners Assn., supra, 21 Cal.4th at pp. 270-271,italics added.)

This dispute and the resulting expense and acrimony are strong testament to the wisdom of such deference.

YEGAN, J., Dissenting.

I know unfairness when I see it. The judgment should be reversed because plaintiffs are entitled to a ruling from the trial court that the Ketelhuts were conducting a business in violation of the Covenants, Conditions, and Restrictions running with the land. (CC&Rs.) It does not matter whether the Ketelhuts could win an award for having the most beautiful vineyard in the world. It does not matter whether the wine from the grapes rivals the finest wines of the Napa Viticulture. As I shall explain, the facts unerringly point to the conclusion that the Ketelhuts were conducting a vineyard business on their property (the Property).

There will, of course, be situations in which the conducting of a business at a residence in violation of the CC&Rs will be so trivial to the neighborhood that it will be deemed not to be in violation of the CC&Rs. There is no reason to list them and one is only limited by imagination. As Colonel Stonehill said, “I do not entertain hypotheticals. The world, as it is, is vexing enough.” (True Grit (2010 film).) So here, we need only decide whether the maintenance of the vineyard as a business is in violation of the CC&Rs.

Judicial Deference Rule

The judicial deference rule applies where an association board “exercises discretion within the scope of its authority under relevant statutes, covenants and restrictions to select among means for discharging an obligation to maintain and repair a development’s common areas.” (Lamden v. La Jolla Shores Clubdominium Homeowners Assn. (1999) 21 Cal.4th 249, 265 (Lamden).) In Lamden our Supreme Court concluded that the courts should defer to the board’s treatment of a termite problem because it was “a matter entrusted to [the board’s] discretion under the [CC&Rs] and [now repealed] Civil Code section 1364.” (Id. at pp. 264-265.) Here, there is no statute or provision in the CC&Rs entrusting to the discretion of the Los Robles Hills Estates Board of Directors (Board) whether a homeowner is engaging in prohibited business or commercial activity within the meaning of the CC&Rs. This is a straightforward legal question to be decided by the courts, not members of the Board who lack legal expertise. (See Smart v. Carpenter (N.M.Ct.App. 2006) 134 P.3d 811, 814 [it “is a question of law” whether homeowner violated covenant prohibiting “`commercial activity or business’ on any tract in the Subdivision”].)

The inapplicability of the judicial deference rule is supported by Dover Village Assn. v. Jennison (2010) 191 Cal.App.4th 123 (Dover Village). There, the issue was whether a sewer pipe was ordinary “common area to be maintained and repaired by the Association” or “`[an] exclusive use common area'” designed to serve a particular homeowner who would be responsible for its maintenance. (Id.at pp. 126-127.) The Association decided that the sewer pipe was the defendant homeowner’s responsibility because it exclusively serviced his condominium. The appellate court concluded that the sewer pipe was not an exclusive use common area. It rejected the Association’s argument that, under Lamden, it should defer to the Association’s decision: “The argument fails because it confuses a legal issue governed by statutory and contract text with matters that genuinely do lend themselves to board discretion. [¶] [¶] There is an obvious difference between a legal issue over who precisely has the responsibility for a sewer line [or whether a homeowner is engaged in prohibited business or commercial activity within the meaning of the CC&Rs] and how a board should go about making a repair that is clearly within its responsibility. . . . [W]e know of no provision in the Davis-St[e]rling Act or the CC&R’s that makes the Association or its board the ultimate judge of legal issues affecting the development.” (Id. at p. 130)

The court considered Lamden to be “a nice illustration of matters genuinely within a board’s discretion.” (Dover Village, supra, 191 Cal.App.4th at p. 130.) Unlike Lamden, the legal issue here is not genuinely within the Board’s discretion. In Lamden the Supreme Court noted, “Common sense suggests that judicial deference in such cases as this is appropriate, in view of the relative competence, over that of courts, possessed by owners and directors of common interest developments to make the detailed and peculiar economic decisions necessary in the maintenance of those developments.” (Lamden, supra, 21 Cal.4th at pp. 270-271.) In contrast to Lamden, the Board is not equipped to determine whether the Ketelhuts were engaged in business or commercial activity in violation of the CC&Rs.

If the judicial deference rule applied here, there would be few board decisions to which it did not apply. The judicial deference rule “does not create a blanket immunity for all the decisions and actions of a homeowners association.” (Affan v. Portofino Cove Homeowners Assn. (2010) 189 Cal.App.4th 930, 940.)

The Vineyard Is Business or Commercial Activity within the Meaning of the CC&Rs

The majority opinion concludes that, as a matter of law, the Ketelhuts’ operation of the vineyard is not a prohibited business or commercial activity because it does not affect the residential character of the community. But paragraph 1.01 of the CC&Rs does not say, “No lot shall be used for any purpose (including any business or commercial activity [that does not affect the residential character of the community]) other than for the residence of one family and its domestic servants.” (Italicized language added.) “`”In construing a contract which purports on its face to be a complete expression of the entire agreement, courts will not add thereto another term, about which the agreement is silent. [Citation.]”‘ [Citation.]” (The Ratcliff Architects v. Vanir Construction Management, Inc. (2001) 88 Cal.App.4th 595, 602.) On its face paragraph 1.01 prohibits any business or commercial activity without qualification or exception. Subparagraph 3 of paragraph 2.03 of the CC&Rs provides that “[f]or good cause shown . . . deviations from the applicable deed restrictions” may be allowed “to avoid unnecessary hardships or expense, but no deviation shall be allowed to authorize a business or commercial use.” (Italics added.) How can the operation of a commercial vineyard not qualify as commercial use?

There may be cases where business or commercial activity is so de minimis or concealed that it does not violate the CC&Rs, such as the example given in the majority opinion of an appellate attorney with a home office who sees no clients on the premises. But the Ketelhuts’ operation of their commercial vineyard was neither de minimis nor concealed. They filed a fictitious business name statement and were issued both a business license and an alcoholic beverage sales license. The licenses originally indicated that the business was located at the Property. Board member Yen testified: “[A] notice of intent to sell [alcoholic beverages] . . . was posted on their front where their mailbox was, and it needed to be posted elsewhere because you’re not supposed to be advertising a business in the community. So they were advised not to post it there.” The Ketelhuts advertised on Facebook, Twitter, their personal web site, “and through [their] wholesale accounts.” They filed an Internal Revenue Service Schedule C (Form 1040) to report their business income or loss. The logo “Los Robles Hills Winery” and their website address were displayed on the exterior of their truck. Although the Ketelhuts covered the truck while it was parked on the Property, the logo and website address were openly displayed when they drove the truck to and from the Property.

The Ketelhuts sought and obtained publicity for their winery by giving an interview to the local newspaper, the Ventura County Star. In January 2011 the newspaper published an article about the winery. Until he read the article, plaintiff John Mitchell was not aware that the Ketelhuts were growing grapes for a commercial purpose. Mitchell “knew that they weren’t supposed to be doing an activity like that because of the CC&Rs,” which “exclude any business activity.”

A copy of the newspaper article was marked as Exhibit 54, but it was neither offered nor received into evidence. I quote from the article because it was before the trial court, witnesses testified as to its content, Felipa Eith quoted from the article during her examination of Jeffrey Ketelhut, and the article arguably is judicially noticeable not to prove the truth of the facts reported, but to prove the extent to which the commercial nature of the vineyard was publicized. (Evid. Code, §§ 452, subd. (h), 459.)

The article takes up the entire front page of the newspaper’s Sunday “Business” section (“Section E”). It is entitled, “GRAPE expectations[:] T.O. [Thousand Oaks] couple’s home vineyard about to pay off.” The article includes photographs of the vineyard, the Ketelhuts, and bottles of wine produced from grapes grown at the vineyard. The bottles are labeled, “Los Robles Hills.” One of the photographs of the Ketelhuts is captioned, “Jeff and Marcella Ketelhut, owners of the commercialvineyard in the Conejo Valley, enjoy discussing the challenges of wine production.” (Italics added.) The article includes the website address of the Ketelhuts’ winery.

The article states in part: “For Jeff and Marcella Ketelhut, the dream of owning a winery has come to fruition on the slopes near their Thousand Oaks home.” “The Ketelhuts are not yet making a profit but said they are selling their wine, at $35 a bottle, through their website, by word of mouth and by hosting wine tastings by appointment at their home tasting room. [¶] . . . The couple also has planted a selection of olive trees on the property and hopes to begin producing cured olives and olive oil for sale in the near future. [¶] They said they are exploring ways to expand their commercial enterprise, given the potential they believe exists in the Conejo Valley. [¶] `We wanted to try it for a few years, and initially it was more of a fun thing, but now we’re barely doing any marketing and the stuff is flying off the shelves,’ said Marcella.” The article observes that “the Ketelhuts’ Los Robles Hills Winery [is] on the list of 15 [wineries] that make up the Ventura County Wine Trail.” Jeffrey Ketelhut testified that in 2010 the Ketelhuts had become “members of the Ventura County Wine Trail.”

Through the newspaper article, the Ketelhuts proclaimed to Ventura County residents that they were operating a commercial vineyard on the Property. It is understandable that homeowners, such as John Mitchell, would be alarmed by this development, which appeared to be a blatant violation of the CC&Rs’ prohibition against “any business or commercial activity.” Homeowners could view the article as a public flaunting by the Ketelhuts of their violation.

The majority opinion states, “No homeowner familiar with the vineyard’s operation would have had reason to suspect that the vineyard was being used to produce wine for sale to the public.” (Maj. opn., ante at p. 27.) But the newspaper article put the entire community on notice that the Ketelhuts were operating a commercial vineyard.

Moreover, the vineyard was in plain view of the homeowners. Richard Monson testified that, “[w]hen [he] drove past the Ketelhuts’ home,” he “noticed the grapevines on the hillside.” Because the grapevines were visible to everyone, they would be a continual source of aggravation to homeowners who objected to a commercial agricultural operation in their community. The majority opinion says that the vineyard was an “aesthetic enhancement.” (Maj. opn., ante at p. 27.) But to the homeowners who objected to its presence, it was an eyesore.

The Ketelhuts’ commercial vineyard was not permissible because, as Board member Daily testified, “Their growing grapes was part of their landscape plan.” The landscape plan, which was approved in 2005 by the Board’s Architectural Committee (the Committee), did not indicate that the vineyard would be used to grow grapes to make wine that would be offered for sale to the public. In 2005 the Ketelhuts did not inform the Committee of this future commercial use. Had it been so informed, the Committee probably would not have approved the landscape plan.

Difficulties may arise in applying the majority opinion’s standard of whether business or commercial activity affects the residential character of the community. With such a vague standard, where does one draw the line between activity that affects and activity that does not affect residential character? This is a purely subjective determination.

A New Meaning for CC&Rs

Traditionally, CC&Rs are restrictions and limitations on land use. Now at the whim of the Board, CC&Rs mean “choices, creativity, and recommendations.” A homeowner has a choice and may be creative in the use of property. The traditional CC&Rs have been transformed into recommendations that the Board may elect not to enforce. Rather than having the force of law, the CC&Rs have the backbone of a chocolate éclair. And, of course, the Board’s composition may change and there will be inconsistency in just how much business or commercial activity will be allowed.

CC&Rs play a vital role in protecting the reasonable expectations of parties when they purchase land. This concept is lost in the majority opinion. Future buyers in the development should be expressly advised that business or commercial activity is allowed at the discretion of the Board. This may actually devalue the land.

Finally, to monetarily punish plaintiffs with attorneys’ fees is not only unfair, it is unconscionable. The Ketelhuts were the “first movers.” They created the entire problem by operating a commercial vineyard and publicizing it in the local newspaper.

They are at fault and they should pay for it.

[*] Pursuant to California Rules of Court, rules 8.1100 and 8.1110, this opinion is certified for partial publication. The portions of this opinion to be deleted from publication are identified as those portions between double brackets, e.g., [[/]].

[1] The Eiths “posit that the 2/10/16 handwritten date appearing adjacent [to] the signature line [on the judgment] is suspect” and “therefore unreliable.” The Eiths contend that the handwritten date “was likely backdated.” (Capitalization and bold omitted.) We reject the contention because it is based on speculation. There is a “presumption that judicial duty is properly performed.” (People v. Coddington(2000) 23 Cal.4th 529, 644, overruled on another ground in Price v. Superior Court (2001) 25 Cal.4th 1046, 1069, fn. 13.) The Eiths have not overcome this presumption.

[2] In his reply brief, Chang argues for the first time that he was denied his “constitutionally protected due process rights to be represented by counsel while actually on the stand under cross-examination.” The point is forfeited because it was not raised in his opening brief. (Benach v. County of Los Angeles(2007) 149 Cal.App.4th 836, 852 & fn. 10; Paulus v. Bob Lynch Ford, Inc. (2006) 139 Cal.App.4th 659, 685.)

[3] Defendants raised the forfeiture issue in their respondent’s brief. The Eiths did not file a reply brief.

[4] See California Attorney Fee Awards (Cont.Ed.Bar 3d ed., 2018 update) Contents of Comprehensive Fee Motion, § 11.53 [“A comprehensive fee motion should include the following: . . . Declarations from the attorneys claiming fees, stating their background and training, their role in the litigation, a description of their services (often with time records attached as an exhibit to the declaration), an explanation of why the hours are reasonable (e.g., hours generated by the losing party’s tactics), a description of any billing judgment exercised, a statement of the hourly rates and their basis, and any other facts the court needs for its determination.”

[5] Jacobellis v. Ohio, (1964) 378 U.S. 184, 197.

Keywords: Business Judgment Rule, Judicial Deference (“Lamden”) Rule, Governing Documents, Enforcement, Interpretation

Dynamex Operations West, Inc., Petitioner, v. The Superior Court Of Los Angeles County, Respondent; Charles Lee et al., Real Parties in Interest.

Whether a worker is properly considered to be an independent contractor depends on whether the hiring entity can prove the elements of the new “ABC Test”: (A) that the worker is free from the control and direction of the hirer in connection with the performance of the work, both under the contract for the performance of such work and in fact; (B) that the worker performs work that is outside the usual course of the hiring entity’s business; and (C) that the worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed for the hiring entity.

***End Summary***

230 Cal.App.4th 718 (2014)
179 Cal.Rptr.3d 69

No. B249546.
Court of Appeals of California, Second District, Division Seven.

October 15, 2014.
721*721 Littler Mendelson, Robert G. Hulteng, Damon M. Ott; Sheppard Mullin Richter & Hampton, Ellen M. Bronchetti and Paul S. Cowie for Petitioner.

No appearance for Respondent.

Pope, Berger & Williams, A. Mark Pope; Glancy Binkow & Goldberg, Kevin Ruf; Boudreau Williams and Jon R. Williams for Real Parties in Interest.

Opinion

PERLUSS, P. J. —

Charles Lee and Pedro Chevez were hired by Dynamex Operations West, Inc. (formerly Dynamex, Inc.) (Dynamex), a nationwide courier and delivery service, as drivers to make deliveries of packages, letters and parcels to Dynamex customers. Prior to 2004 Dynamex had classified its California drivers as employees and compensated them subject to this state’s wage and hour laws. In 2004 Dynamex converted the status of all drivers from employee to independent contractor. This lawsuit was filed in April 2005 alleging that drivers, as a practical matter, continued to perform the same tasks as they had when classified as employees with no substantive changes to the means of performing their work or the degree of control exercised by Dynamex and, as a consequence, the reclassification of Dynamex drivers violated California law. The plaintiff, Charles Lee, sought to represent approximately 1,800 drivers engaged by Dynamex as independent contractors. After its initial denial of class certification was reversed by this court, respondent superior court certified the proposed class in 2011.

722*722 Over the course of the next two years, Dynamex twice moved to decertify the class. When its second motion was denied, Dynamex filed this petition for a writ of mandate, arguing the superior court had improperly adopted the definition of “employee” found in Industrial Welfare Commission (IWC) wage orders[1] to ascertain the status of class members (see Martinez v. Combs (2010) 49 Cal.4th 35 [109 Cal.Rptr.3d 514, 231 P.3d 259] (Martinez)), and had failed to use the common law test for distinguishing between employees and independent contractors discussed in S. G. Borello & Sons, Inc. v. Department of Industrial Relations (1989) 48 Cal.3d 341 [256 Cal.Rptr. 543, 769 P.2d 399] (Borello). According to Dynamex, if the Borello common law test, rather than the IWC standard approved in Martinez, is applied, the class must be decertified because the predominance of individual issues relevant to that test would make it infeasible to litigate plaintiffs’ claims as a class action.

(1) We issued an order to show cause why respondent superior court should not be compelled to vacate its order denying the motion to decertify the class. We now grant the petition in part. We conclude the superior court correctly allowed plaintiffs to rely on the IWC definition of an employment relationship for purposes of those claims falling within the scope of IWC Wage Order No. 9-2001 (Wage Order No. 9). (Cal. Code Regs., tit. 8, § 11090.) With respect to those claims falling outside the scope of Wage Order No. 9, the common law definition of employee will control. As to those claims, we grant the petition to allow the superior court to reevaluate whether, in light of the Supreme Court’s recent decision in Ayala v. Antelope Valley Newspapers, Inc. (2014) 59 Cal.4th 522 [173 Cal.Rptr.3d 332, 327 P.3d 165] (Ayala), class certification remains appropriate by focusing its analysis “on differences in [the defendant’s] right to exercise control” rather than “variations in how that right was exercised.” (Id. at p. 528.)

Factual and Procedural Background

1. The Motions to Certify and to Decertify the Class
Lee and his coplaintiff, Pedro Chevez, are former same-day delivery drivers who were engaged by Dynamex as independent contractors. The operative second amended complaint alleges Dynamex’s classification of 723*723 drivers as independent contractors rather than employees violated provisions of Wage Order No. 9, as well as various sections of the Labor Code,[2] and it had engaged in unfair and unlawful business practices under Business and Professions Code section 17200.

Lee’s first motion for class certification, filed in November 2006, was denied on two grounds — the inascertainability of the class and a lack of common issues. We reversed that ruling. (Lee v. Dynamex, Inc. (2008) 166 Cal.App.4th 1325 [83 Cal.Rptr.3d 241].) Based on the Supreme Court’s intervening decision in Pioneer Electronics (USA), Inc. v. Superior Court (2007) 40 Cal.4th 360 [53 Cal.Rptr.3d 513, 150 P.3d 198], we concluded the trial court had improperly denied Lee’s “motion to compel Dynamex to identify and provide contact information for potential putative class members,” a ruling that “improperly interfered with Lee’s ability to establish the necessary elements for class certification ….” (Lee v. Dynamex, supra, 166 Cal.App.4th at p. 1329.)

In June 2009 Lee filed a second motion for class certification, which was granted. The certified class contained four subclasses and several limited exclusions involving drivers who had hired other drivers to perform services for Dynamex, worked for other companies while also driving for Dynamex or transported certain hazardous items or transported freight in interstate commerce. Because of the lack of records sufficient to identify members of the class, the parties agreed to send questionnaires to each putative class member seeking information as to class membership. The trial court entered a stipulated order that the class was only “conditionally” certified pending the questionnaire process.

According to Dynamex, the questionnaire responses proved the unworkable nature of the proposed class. In December 2010 it moved to decertify the class on the grounds no records existed to identify class members; individualized inquiries were necessary to determine employment status; and contradictions in sworn testimony demonstrated the need for cross-examination to avoid a violation of its due process rights. The trial court granted the motion but allowed plaintiffs to change the class definition one more time. The court subsequently vacated the order decertifying the class and continued the motion to allow plaintiffs to file a third motion for class certification. Relying on the Supreme Court’s then recent decision in Martinez, supra, 49 Cal.4th 35, Lee and Chevez contended drivers met the test for employment so long as Dynamex knew the drivers were providing services or negotiated the rates paid to the drivers: In other words, adherence to the common law rule 724*724 described in Borello was not necessary to certification of the proposed class. The superior court agreed and certified the class.[3]

In December 2012 Dynamex renewed its motion to decertify the class on the ground intervening law had demonstrated the error of the court’s reliance on Martinez. The superior court denied the motion to decertify.

2. The Petition for Writ of Mandate
On June 24, 2013 Dynamex petitioned this court for a writ of mandate directing the superior court to vacate its ruling denying the motion to decertify the class and to enter a new order decertifying the class. In response to our invitation to file a preliminary opposition to the petition, real parties in interest Lee and Chevez submitted a letter stating they strongly disagreed with Dynamex’s legal arguments but supported its request that we issue an order to show cause and review the issues presented in the writ petition at this time. Accordingly, on July 10, 2013 we issued an order to show cause to determine whether the superior court erred in ruling a class may be certified under the IWC definition of employee as construed by the Supreme Court in Martinez or, as Dynamex contends, may proceed only under the common law test discussed in Borello.

Lee and Chevez filed their written return on October 8, 2013; Dynamex filed a reply on November 15, 2013. Pursuant to California Rules of Court, rule 8.200(a)(4), on July 7, 2014 this court requested that the parties file supplemental letter briefs addressing the effect, if any, of the Supreme Court’s recent decisions in Duran v. U.S. Bank National Assn. (2014) 59 Cal.4th 1 [172 Cal.Rptr.3d 371, 325 P.3d 916] (Duran) and Ayala, supra, 59 Cal.4th 522. Supplemental briefs were received in August 2014,[4] and oral argument was heard on October 3, 2014. We now grant the petition in part.

725*725 Discussion

1. Standard of Review
(2) To prevail on a motion to certify a class, “[t]he party advocating class treatment must demonstrate the existence of an ascertainable and sufficiently numerous class, a well-defined community of interest, and substantial benefits from certification that render proceeding as a class superior to the alternatives. [Citations.] `In turn, the “community of interest requirement embodies three factors: (1) predominant common questions of law or fact; (2) class representatives with claims or defenses typical of the class; and (3) class representatives who can adequately represent the class.”‘” (Brinker Restaurant Corp. v. Superior Court (2012) 53 Cal.4th 1004, 1021 [139 Cal.Rptr.3d 315, 273 P.3d 513]; accord, Ayala, supra, 59 Cal.4th at pp. 529-530.) “`The certification question is “essentially a procedural one that does not ask whether an action is legally or factually meritorious.”‘” (Brinker, at p. 1023.) Nonetheless, “a court may `consider[] how various claims and defenses relate and may affect the course of the litigation’ even though such `considerations … may overlap the case’s merits.'” (Id. at p. 1024.)

We review a trial court’s ruling on a certification motion, as well as a decertification motion, for abuse of discretion and generally will not disturb it “`”unless (1) it is unsupported by substantial evidence, (2) it rests on improper criteria, or (3) it rests on erroneous legal assumptions.”‘” (Ayala, supra, 59 Cal.4th at p. 530; see Harper v. 24 Hour Fitness, Inc. (2008) 167 Cal.App.4th 966, 973-974 [84 Cal.Rptr.3d 532].) As in Ayala, “the central legal issue” presented here is “whether putative class members are employees for purposes of the provisions under which they sue.” (Ayala, at p. 530.) “If they are employees, [Dynamex] owes them various duties that it may not have fulfilled; if they are not, no liability can attach.” (Ibid.)

2. Common Law Principles for Identification of an Employee Relationship
(3) “Under the common law, `”[t]he principal test of an employment relationship is whether the person to whom service is rendered has the right to control the manner and means of accomplishing the result desired ….”‘ [Citations.] What matters is whether the hirer `retains all necessary control’ over its operations. [Citation.] `”[T]he fact that a certain amount of freedom of action is inherent in the nature of the work does not change the character of the employment where the employer has general supervision and control 726*726 over it.”‘ [Citations.] Perhaps the strongest evidence of the right to control is whether the hirer can discharge the worker without cause, because `[t]he power of the principal to terminate the services of the agent gives him the means of controlling the agent’s activities.'” (Ayala, supra, 59 Cal.4th at p. 531, quoting, inter alia, Borello, supra, 48 Cal.3d at p. 350.) Secondary indicia of employment status under the common law include “`(a) whether the one performing services is engaged in a distinct occupation or business; (b) the kind of occupation, with reference to whether, in the locality, the work is usually done under the direction of the principal or by a specialist without supervision; (c) the skill required in the particular occupation; (d) whether the principal or the worker supplies the instrumentalities, tools, and the place of work for the person doing the work; (e) the length of time for which the services are to be performed; (f) the method of payment, whether by the time or by the job; (g) whether or not the work is a part of the regular business of the principal; and (h) whether or not the parties believe they are creating the relationship of employer-employee.'” (Ayala, at p. 532, quoting Borello, at p. 351.)

In Ayala the Supreme Court revisited the common law definition of an employee relationship in the same context as is at issue in this case — that is, whether a class may be certified in a wage and hour action alleging the defendant had misclassified its employees as independent contractors. The trial court had denied the plaintiffs’ motion to certify the putative class of newspaper carriers hired by the Antelope Valley Press to deliver its newspaper after finding common issues did not predominate. (Ayala, supra, 59 Cal.4th at p. 529.) The trial court reasoned Borello’s common law test for an employment relationship would require “`heavily individualized inquiries'” into the newspaper’s control over the carriers’ work. (Ayala, at p. 529.) While the case was pending before it, the Supreme Court directed the parties to submit supplemental briefs discussing the relevance of Martinez and IWC wage order No. 1-2001, subdivision 2(D)-(F) to the issues in the case. (Ayala, at p. 531.)[5] Although raising the question presented here, that is, in evaluating whether common issues predominate on the certification question a class plaintiff may rely on the applicable IWC wage order to determine employee status or is instead limited to the common law test, the Supreme Court reversed the trial court’s ruling without resolving it. Because the plaintiffs had proceeded under the common law definition, the court limited its discussion to whether the plaintiffs’ claims were susceptible to proof on a classwide basis under that test. Finding the trial court should have focused on “differences in [the defendant’s] right to exercise control,” rather than “variations in how that right was exercised” (59 Cal.4th at p. 528) in 727*727 concluding individual issues predominated, the court reversed the order denying class certification and remanded the case for reconsideration of the motion under the correct legal standards (id. at p. 540).

3. Martinez and the IWC Definition of an Employment Relationship
(4) In Ayala the court found it unnecessary to discuss the statutory context of the plaintiffs’ claims,[6] focusing instead on how a court should approach the question of certification when an applicable standard (there, the common law test for an employment relationship) appears to implicate individualized factual issues that might make litigation of the case as a class action unmanageable. (See Ayala, supra, 59 Cal.4th at pp. 537-538.) In Martinez, on the other hand, the court discussed at length the impact of the IWC regulatory scheme on whether an employment relationship had arisen between a group of farm laborers and the merchants who bought the produce from the farmer who employed the laborers. (See Martinez, supra, 49 Cal.4th at pp. 52-57.) Although the court concluded the produce merchants were not joint employers of the farm laborers, it made clear IWC wage orders are to be accorded the same weight as statutes and the applicable wage order defines the employment relationship for wage and hour claims within its scope. (Id. at pp. 52, 61.)

The farm laborers in Martinez sued the produce merchants under section 1194, which creates a private right of action on behalf of employees seeking to recover unpaid wages.[7] Because this Labor Code section does not specify who is liable under its terms, the Supreme Court analyzed the legislative history associated with its adoption. In short, section 1194 was part of 1913 legislation that also created the IWC, which was empowered to issue wage orders governing specific industries and occupations. (Martinez, supra, 49 728*728 Cal.4th at pp. 54-56; see Brinker Restaurant Corp. v. Superior Court, supra, 53 Cal.4th at p. 1026 [“[n]early a century ago, the Legislature responded to the problem of inadequate wages and poor working conditions by establishing the IWC and delegating to it the authority to investigate various industries and promulgate wage orders fixing for each industry minimum wages, maximum hours of work, and conditions of labor”].) Since 1913, the court observed, “the Legislature has `restated the commission’s responsibility in even broader terms’ [citation], charging the IWC with the `continuing duty’ to ascertain the wages, hours and labor conditions of `all employees in this state,’ to `investigate [their] health, safety, and welfare,’ to `conduct a full review of the adequacy of the minimum wage at least once every two years’ [citation], and to convene wage boards and adopt new wage orders if the commission finds `that wages paid to employees may be inadequate to supply the cost of proper living’ [citations].” (Martinez, at p. 55.) The court concluded, “[A]n examination of section 1194 in its full historical and statutory context shows unmistakably that the Legislature intended to defer to the IWC’s definition of the employment relationship in actions under the statute.” (Id. at p. 64.)[8]

(5) The IWC wage orders share common definitions and schemes, including the definition of employment: Like all other wage orders, Wage Order No. 9, applicable to the transportation industry, defines the word “employ” as “to engage, suffer, or permit to work.” (Cal. Code Regs., tit. 8, § 11090, subd. 2(D).) An employer is defined as any person “who directly or indirectly, or through an agent or any other person, employs or exercises control over the wages, hours, or working conditions of any person.” (Id., § 11090, subd. 2(F).) This is the same language examined by the Supreme Court in Martinez. (See Martinez, supra, 49 Cal.4th at p. 64.) Parsing this language in light of the IWC’s statutory purposes, Martinez concluded that “[t]o employ, then, under the IWC’s definition, has three alternative definitions. It means: (a) to exercise control over the wages, hours or working conditions, or (b) to suffer or permit to work, or (c) to engage, thereby creating a common law employment relationship.” (Ibid.)

729*729 As is evident from the Martinez court’s analysis, it is not inappropriate to rely on the common law standard to determine whether an employment relationship exists for purposes of liability under section 1194. However, Martinez recognized that limiting plaintiffs to that test in actions under section 1194 and “ignoring the rest of the IWC’s broad regulatory definition would substantially impair the commission’s authority and the effectiveness of its wage orders.” (Martinez, supra, 49 Cal.4th at p. 65.) “One cannot overstate the impact of [this] holding on the IWC’s powers. Were we to define employment exclusively according to the common law in civil actions for unpaid wages we would render the commission’s definitions effectively meaningless.” (Ibid.)

(6) Borello in many ways foreshadowed Martinez’s embrace of the IWC definition. There, in holding that cucumber sharefarmers were not independent contractors excluded from coverage under the Workers’ Compensation Act, the Supreme Court explained, “The distinction between independent contractors and employees arose at common law to limit one’s vicarious liability for the misconduct of a person rendering service to him.” (Borello, supra, 48 Cal.3d at p. 350.) As a matter of fairness to the employer, his or her liability was premised on the extent to which the employer had the right to control the details of the employee’s service. (Ibid.) In the wake of 20th-century industrialization, versions of this “control” test were imported into legislation designed to protect workers as an express or implied limitation on coverage. (Ibid.) Courts struggling to apply this limited test to “the infinite variety of service arrangements” eventually embraced the cluster of secondary indicia discussed above to guide resolution of these questions. (Ibid., citing, inter alia, Rest.2d Agency, § 220, Tieberg v. Unemployment Ins. Appeals Board (1970) 2 Cal.3d 943, 949-950 [88 Cal.Rptr. 175, 471 P.2d 975] and Empire Star Mines Co. v. California Employment Com. (1946) 28 Cal.2d 33, 43 [168 P.2d 686].) Borello, however, recognized that the control test arose to meet the needs of employers and was not focused on protection of their employees: To accommodate this conceptual distinction, the court instructed that the common law “`control-of-work-details’ test for determining whether a person rendering service to another is an `employee’ or an excluded `independent contractor’ must be applied with deference to the purposes of the protective legislation. The nature of the work, and the overall arrangement between the parties, must be examined to determine whether they come within the `history and fundamental purposes’ of the statute.” (Borello, at pp. 353-354.)

Martinez, in effect, fills the gap between the common law employer-focused approach and the need for a standard attuned to the needs and 730*730 protection of employees. As the court recognized, the IWC wage orders provide an employee-centric test gauged to mitigate the potential for employee abuse in the workplace: “[T]he scope of the IWC’s delegated authority is, and has always been, over wages, hours and working conditions. [Citations.] For the IWC to adopt a definition of `employer’ that brings within its regulatory jurisdiction an entity that controls any one of these aspects of the employment relationship makes eminently good sense.” (Martinez, supra, 49 Cal.4th at p. 59.) “For a court to refuse to enforce such a provision in a presumptively valid wage order [citation] simply because it differs from the common law would thus endanger the commission’s ability to achieve its statutory purposes.” (Id. at p. 65.)

4. The Trial Court Did Not Err in Allowing Certification Based on the IWC Definition of Employee as to Claims Falling Within the Scope of Wage Order No. 9
Dynamex contends the superior court’s ruling is an outlier and insists no other court has resorted to the first two prongs of the IWC definition of employee in certifying a class in a wage and hour case. Under this “extreme view,” Dynamex asserts, “independent contractors will no longer exist in California.”

(7) Contrary to Dynamex’s overblown rhetoric, the decisions it cites as rejecting application of Martinez in fact confirm its broad sweep. In Futrell v. Payday California, Inc. (2010) 190 Cal.App.4th 1419 [119 Cal.Rptr.3d 513], for instance, the court applied the IWC definition of employment because “Martinez governs our determination of the issues in the current case. [Citation.] Martinez teaches that, in actions under section 1194 to recover unpaid wages, an IWC wage order governing a subject industry defines the employment relationship, and thus who may be held liable — as an employer — for unpaid wages.” (Futrell, at p. 1429.) Although utilizing the IWC definition, the court affirmed summary judgment in favor of the payroll company because it did not exercise control over the plaintiff’s wages, hours or working conditions; did not have the power to cause or prevent him from working; and did not control any aspect of his job performance. (Id. at pp. 1431-1435; see Aleksick v. 7-Eleven, Inc. (2012) 205 Cal.App.4th 1176, 1187-1190 [140 Cal.Rptr.3d 796] [applying Martinez to find defendant was not an employer even though no wage order involved]; Guerrero v. Superior Court (2013) 213 Cal.App.4th 912, 945-952 [153 Cal.Rptr.3d 315] [applying Martinez to find public agency exercised effective control over provider wages; trial court erred in determining as a matter of law public agency was not an employer for purposes of IWC wage order].)

731*731 Similarly, in Sotelo v. Medianews Group, Inc., supra, 207 Cal.App.4th 639, a wage and hour class certification appeal, the appellate court recognized “the trial court should not have limited itself to the test for a common law employment relationship because [the plaintiffs’] third cause of action, for violation of minimum wage and overtime laws, comes under Labor Code section 1194.” (Id. at pp. 661-662.) The Sotelo court concluded this error was harmless in light of the trial court’s determination “that, even assuming that putative class members were employees, common issues did not predominate in the third cause of action.” (Id. at p. 662.) Echoing Sotelo’s analysis but reaching the opposite conclusion, the court in Bradley v. Networkers Internat., LLC (2012) 211 Cal.App.4th 1129 [150 Cal.Rptr.3d 268] found common issues of fact warranted certification of a class of telecommunications workers under either the Borello or Martinez standard. With respect to seven causes of action — six of which were not based on section 1194 — the court interpreted Martinez to apply to all claims brought under an IWC wage order. (Bradley, at p. 1146.) Presaging the opinion in Ayala, the court explained: “Under [class certification] analysis, the focus is not on the particular task performed by the employee, but on the global nature of the relationship between the worker and the hirer, and whether the hirer or the worker had the right to control the work. The undisputed evidence showed Networkers had consistent companywide policies applicable to all employees regarding work scheduling, payments, and work requirements. Whether those policies created an employer-employee relationship, as opposed to an independent contractor relationship, is not before us. The critical fact is that the evidence likely to be relied upon by the parties would be largely uniform throughout the class.” (Bradley, at p. 1147.)[9]

Other decisions cited by Dynamex arose in contexts not subject to IWC wage orders and thus outside the scope of Martinez. Bowman v. Wyatt (2010) 186 Cal.App.4th 286 [111 Cal.Rptr.3d 787], for example, was a tort action that applied the common law test to the question whether the tortfeasor was an employee or independent contractor of the defendant. In Angelotti v. The Walt Disney Co. (2011) 192 Cal.App.4th 1394 [121 Cal.Rptr.3d 863] a stuntman sued Disney for injuries he had received on the set. The court affirmed summary judgment in favor of Disney after finding the plaintiff was an employee and that workers’ compensation was his exclusive remedy. 732*732 Neither of these cases involved a wage and hour claim within the scope of an IWC work order.[10]

Dynamex also cites Arnold v. Mutual of Omaha Ins. Co. (2011) 202 Cal.App.4th 580 [135 Cal.Rptr.3d 213] (Arnold) to demonstrate courts have rejected Martinez. In Arnold a nonexclusive insurance agent for Mutual of Omaha sued the company seeking unpaid employee entitlements under the Labor Code. (Id. at p. 582.) Mutual of Omaha moved for summary judgment on the ground she was an independent contractor rather than an employee under the common law test. (Id. at p. 583.) The agent contended section 2750 defined “employee” for purposes of her rights under section 2802.[11] The appellate court rejected that argument and affirmed the trial court’s order granting summary judgment, relying in part on the application of the common law test to a claim under section 2802 in Estrada v. FedEx Ground Package System, Inc. (2007) 154 Cal.App.4th 1 [64 Cal.Rptr.3d 327],[12] as well as its 733*733 own conclusion that “section 2750 does not supply … a definition of `employee’ that is clearly and unequivocally intended to supplant the common law definition of employment for purposes of section 2802.” (Arnold, at p. 587.) As the court noted, “when a statute refers to an `employee’ without defining the term, courts have generally applied the common law test of employment to that statute.” (Id. at p. 586.)

(8) According to Dynamex, Arnold “referenced Martinez elsewhere in its opinion, but then determined that `the trial court correctly determined the common law [(Borello)] test of employment was applicable for purposes of Section 2802.’ The Arnold Court was clearly aware of Martinez” However, the sole “reference” to Martinez in Arnold is the court’s citation of Reynolds v. Bement (2005) 36 Cal.4th 1075 [32 Cal.Rptr.3d 483, 116 P.3d 1162] as “disapproved” by Martinez “on another ground.” (Arnold, supra, 202 Cal.App.4th at p. 586.) There is no discussion of Martinez or the IWC definition because the plaintiff apparently did not contend she was covered by a wage order. Indeed, IWC wage orders exempt from coverage “persons employed in administrative, executive, or professional capacities” — persons like the plaintiff — with respect to certain mandates, including the right to reimbursement of particular expenses. (Cal. Code Regs., tit. 8, § 11040, subds. 1(A), 8 & 9.)[13] Absent an applicable wage order, Arnold is not authority for the contention the common law standard of employment governs claims in this case, which do involve a controlling wage order. (See Chevron U.S.A., Inc. v. Workers’ Comp. Appeals Bd. (1999) 19 Cal.4th 1182, 1195 [81 Cal.Rptr.2d 521, 969 P.2d 613] [language in a judicial opinion is to be understood in accordance with the facts and issues before the court; an opinion is not authority for propositions not considered].)

In sum, Dynamex has failed to convince us the superior court erred as a matter of law in denying its motion to decertify the class with respect to claims falling within the scope of Wage Order No. 9. The court properly applied Martinez in determining plaintiffs were employees within the meaning of that wage order.[14]

734*734 5. The Trial Court Should Reevaluate in Light of Ayala Whether Class Certification Remains Appropriate for Any Claims Falling Outside Wage Order No. 9
Lee and Chevez’s second amended complaint contains five causes of action, all of which are alleged to fall within the scope of Wage Order No. 9: (1) unfair business practices under Business and Professions Code section 17200 arising from violations of various Labor Code and wage order provisions; (2) unlawful business practices under the same section; (3) failure to pay overtime compensation in violation of section 1194 and other provisions; (4) failure to provide accurate wage statements in violation of section 226; and (5) failure to fully compensate for business expenses in violation of section 2802. The trial court did not distinguish among these claims in granting the motion for class certification.

(9) Notwithstanding the legal conclusion alleged in their pleading, it is by no means clear at this point in the litigation whether all of Lee and Chevez’s claims under section 2802 (and the related claims for unfair or unlawful business practices), if proved, would be violations of Wage Order No. 9. To be sure, the wage order contains several provisions that arguably relate to the section 2802 claim: Employers may not deduct from the employee’s wages or require reimbursement for “any cash shortage, breakage, or loss of equipment” (Cal. Code Regs., tit. 8, § 11090, subd. 8); the employer must provide and maintain uniforms worn by the employee as a condition of employment (id., § 11090, subd. 9(A)); and necessary tools and equipment shall be provided and maintained by the employer (id., § 11090, subd. 9(B)). To the extent the reimbursement sought by Lee and Chevez in their section 2802 claim is confined to these items, the IWC definition of employee must be applied pursuant to Martinez, as discussed in the preceding part of our opinion.

Claims for reimbursement for the rental or purchase of personal vehicles used in performing delivery services, even if viable under section 2802, appear to be outside the ambit of Wage Order No. 9. (See Estrada v. FedEx Ground Package System, Inc., supra, 154 Cal.App.4th at pp. 21-25.) If so, the determination whether a class is properly certified to pursue those claims must be made under the common law definition of employee as discussed in Ayala and Borello. That evaluation is most appropriately made by the superior court in the first instance.

Disposition

The petition is granted in part. Let a peremptory writ of mandate issue directing respondent superior court to reevaluate in light of Ayala, supra, 59 735*735 Cal.4th 522 and Duran, supra, 59 Cal.4th 1, if relevant, whether class certification remains appropriate for any claims falling outside Wage Order No. 9. In all other respects the petition is denied. The parties are to bear their own costs in this proceeding.

Woods, J., and Zelon, J., concurred.

[1] The IWC is the state agency empowered to regulate wages, hours and working conditions through wage orders governing specific industries and occupations. (See Brinker Restaurant Corp. v. Superior Court (2012) 53 Cal.4th 1004, 1027 [139 Cal.Rptr.3d 315, 273 P.3d 513]; Ramirez v. Yosemite Water Co. (1999) 20 Cal.4th 785, 795 [85 Cal.Rptr.2d 844, 978 P.2d 2].)

[2] Statutory references are to the Labor Code unless otherwise indicated.

[3] The certified class was defined as “Persons classified as independent contractors who performed pick-up or delivery services for Dynamex Operations West, Inc., in the State of California between April 15, 2001 and the present time using their personally owned or leased vehicles with Gross Vehicle Weight Ratings of less than 26,000 lbs.” Subclass 1 was defined as “Drivers who used vehicles with Gross Vehicle Weight Ratings (GVWR) of 10,000 lbs or less to perform services for DYNAMEX.” Subclass 2 was defined as “Drivers who used vehicles with Gross Vehicle Weight Ratings (GVWR) in excess of 10,001 lbs and less than 26,000 lbs to perform services for DYNAMEX.” The class excluded drivers who had not returned questionnaires; provided services for Dynamex while employed or subcontracted to another person or entity; provided services for Dynamex through their own employees or subcontractors; performed services for Dynamex and unrelated delivery services; or performed services for Dynamex and their own personal customers.

[4] Dynamex argued in its letter brief that Ayala was irrelevant to the issues raised in its petition but that Duran, which involved the manageability of individual issues in evaluating class certification, supported its argument the superior court had erred in denying its decertification motion. Lee and Chevez, on the other hand, insisted Duran provided little guidance since it primarily concerned the use of statistical sampling in the trial of a class action lawsuit, but that Ayala has direct application to this case.

[5] The order for supplemental briefing also cited Sotelo v. Medianews Group, Inc. (2012) 207 Cal.App.4th 639, 660-662 [143 Cal.Rptr.3d 293] and Bradley v. Networkers Internat., LLC (2012) 211 Cal.App.4th 1129, 1146-1147 [150 Cal.Rptr.3d 268], cases we discuss below.

[6] Responding to Justice Chin’s reservations, the court stated: “As Justice Chin’s concurrence notes, Borello recognized `the concept of “employment” embodied in the [Workers’ Compensation] Act is not inherently limited by common law principles’ (Borello, supra, 48 Cal.3d at p. 351) and identified a handful of other considerations that might `overlap those pertinent under the common law’ (id. at p. 354; see id. at pp. 351-355 [discussing additional considerations relevant in light of the remedial purposes of the statutory scheme there at issue]). Strictly speaking, however, those further considerations are not part of the common law test for employee status. The concurrence’s assertion they are relevant here (conc. opn. of Chin, J., post, at pp. 548-550) rests on the legal assumption they play a role in deciding employee status for wage claims, an assumption we decline to embrace, leaving for another day resolution of its validity. (See Martinez[, supra,] 49 Cal.4th at pp. 64, 73.)” (Ayala, supra, 59 Cal.4th at p. 532, fn. 3.)

[7] Section 1194, subdivision (a), provides: “Notwithstanding any agreement to work for a lesser wage, any employee receiving less than the legal minimum wage or the legal overtime compensation applicable to the employee is entitled to recover in a civil action the unpaid balance of the full amount of this minimum wage or overtime compensation, including interest thereon, reasonable attorney’s fees, and costs of suit.”

[8] The Legislature defunded the IWC in 2004; however, its wage orders remain in effect. (Peabody v. Time Warner Cable, Inc. (2014) 59 Cal.4th 662, 667, fn. 3 [174 Cal.Rptr.3d 287, 328 P.3d 1028].) There are currently 18 wage orders. Sixteen relate to specific industries or occupations: manufacturing; personal service; canning, freezing and preserving; professional, technical, clerical, mechanical and the like; public housekeeping; laundry, linen supply and dry cleaning; mercantile; product handling after harvest (covering commercial packing sheds); transportation; amusement and recreation; broadcasting; motion picture; preparation of agricultural products for market (on the farm); agricultural; household; and construction, drilling, logging and mining. There is also one general minimum wage order, and one order implementing the Eight-Hour-Day Restoration and Workplace Flexibility Act of 1999. (See Cal. Code Regs., tit. 8, §§ 11000-11170; Brinker Restaurant Corp. v. Superior Court, supra, 53 Cal.4th at p. 1026; Martinez, supra, 49 Cal.4th at p. 57.)

[9] Dynamex cites several federal decisions that apply Borello’s common law test in determining whether an employee relationship exists in a misclassification lawsuit without discussing the impact of Martinez. (See, e.g., Alexander v. FedEx Ground Package System, Inc. (9th Cir. 2014) 765 F.3d 981; Ruiz v. Affinity Logistics Corp. (9th Cir. 2014) 754 F.3d 1093.) We, of course, are not bound by federal interpretations of California law.

[10] Dynamex also cites Monarrez v. Automobile Club of Southern California (Cal.App.), notwithstanding that review had been granted by the Supreme Court on February 13, 2013 (S207726), more than four months before it filed its writ petition in this court. (See Cal. Rules of Court, rules 8.1105(e)(1) [unless otherwise ordered, an opinion is no longer considered published if the Supreme Court grants review], 8.1115(a) [with limited exceptions, a Court of Appeal opinion that is not certified for publication “must not be cited or relied on by a court or a party in any other action”].) In any event, Monarrez, like Bowman, was a tort action; the issue was whether a tow truck company assisting the plaintiff, who was injured by a hit-and-run driver while being aided by the tow truck operator, was the actual or ostensible agent of the Automobile Club of Southern California or whether it was an independent contractor. The Supreme Court ordered briefing in Monarrez deferred pending its decision in Patterson v. Domino’s Pizza, LLC (2014) 60 Cal.4th 474 [177 Cal.Rptr.3d 539, 333 P.3d 723], which held the defendant franchisor was entitled to summary judgment on the plaintiff’s claim that it was vicariously liable for tortious conduct by a supervising employee of a franchisee.

[11] Section 2802, subdivision (a), provides: “An employer shall indemnify his or her employee for all necessary expenditures or losses incurred by the employee in direct consequence of the discharge of his or her duties, or of his or her obedience to the directions of the employer, even though unlawful, unless the employee, at the time of obeying the directions, believed them to be unlawful.”

Section 2750 provides: “The contract of employment is a contract by which one, who is called the employer, engages another, who is called the employee, to do something for the benefit of the employer or a third person.”

[12] Estrada, decided by our colleagues in Division One of this court, was written nearly three years before the Supreme Court’s decision in Martinez. Applying Borello, Estrada concluded the plaintiff FedEx drivers were employees rather than independent contractors: The court referred to the result as the “if it looks like a duck, walks like a duck, swims like a duck, and quacks like a duck, it is a duck” test. (Estrada v. FedEx Ground Package System, Inc., supra, 154 Cal.App.4th at p. 9.) We have little doubt, if decided today, the Estrada court would follow Martinez and find the FedEx drivers were employees within the meaning and scope of Wage Order No. 9.

[13] IWC wage order No. 4-2001 regulates wages, hours, and working conditions in professional, technical, clerical, mechanical and similar occupations but contains the same exemption for “persons employed in administrative, executive, or professional capacities” found in every wage order.

[14] Dynamex contends, both in its briefs and at oral argument, that the holding in Martinez should be limited to determining whether an entity is a joint employer — that is, whether an individual who is unquestionably an employee of one entity may hold another entity liable for wages or other employment benefits not provided by the primary employer. Although that was the precise factual context in which the issue arose in Martinez, nothing in the case supports a limitation of this nature; and, as the foregoing discussion demonstrates, no other court has adopted it.

Carolyn Staats, Plaintiff and Appellant, v. Vinter’s Golf Club, LLC, Defendant and Respondent.

The duty of golf course operators to maintain their property in a reasonably safe condition includes the duty to exercise reasonable care to protect patrons from dangerous wildlife, like yellow jackets, on the premises.

*** End Summary **

25 Cal.App.5th 826 (2018)
No. A147928.
Court of Appeals of California, First District, Division One.

August 1, 2018.
Appeal from the Napa County, No. 26-64964, Superior Court, Hon. Diane M. Price.

Law Office of Bruce L. Ahnfeldt, Bruce L. Ahnfeldt and Frederick H. Brennan for Plaintiff and Appellant.

Wood, Smith, Henning & Berman, Gregory P. Arakawa and Steven R. Disharoon for Defendant and Respondent.

830*830 OPINION
HUMES, P.J. —

Plaintiff Carolyn Staats nearly died after being attacked by a swarm of yellow jackets while playing golf on a Yountville course operated by Vintner’s Golf Club, LLC (Club). She sued the Club for general negligence and premises liability, but the trial court granted summary judgment against her on the basis that the Club owed no duty to protect its patrons from yellow jackets that came from an undiscovered nest on the course.

(1) We reverse. We hold that the duty of golf course operators to maintain their property in a reasonably safe condition includes a duty to exercise reasonable care to protect patrons from nests of yellow jackets on the premises. The measures a golf course operator must take to satisfy this duty may vary, and we do not address whether the Club breached its duty, or whether any such breach caused Staats’s injuries. Here, those questions involve unresolved issues of material fact that must be determined by the trier of fact in the first instance.

I. Factual and Procedural Background

In early July 2013, Staats was taking a golf lesson from Jeffrey Dennis, an instructor at the Club. As she prepared to take a shot on the fairway of the fifth hole, she was attacked by a swarm of yellow jackets.[1] She screamed, and Dennis tried to swat away the insects. The two then ran about 150 yards until the swarm stopped pursuing them.

Staats got into a car to be taken to the hospital and started losing consciousness. Dennis remembered there was a fire station close by, and he ran ahead to summon the paramedics outside while someone else drove 831*831 Staats to the station. She was given a shot and quickly transported to a Napa hospital. A paramedic said Staats had been “within fifteen seconds” of dying.

Staats had been stung over 50 times, and she experienced “redness, welts, and swelling” all over her body. She spent the night in the intensive care unit and missed over five weeks of work. The attack left her highly allergic to yellow jacket stings, and she now must be given three injections per month and carry multiple epinephrine pens.

At the time of the incident, the Club had no written policy on inspecting its grounds for dangerous conditions or pests. It did, however, have a pest control company, Clark Pest Control (Clark), perform monthly inspections around the Club’s restaurant and offices, primarily to discover and eradicate “roaches, insects, [and] ants.” Both the Club’s golf director and its grounds superintendent had seen stray yellow jackets or bees on the golf course before, but it is undisputed that before Staats was attacked the Club had no actual knowledge of any swarm, hive, or nest ever being on the grounds or of any patron ever being stung there. The Club never set traps or took other measures to control yellow jackets because it did not perceive them to be a problem.

The day after the attack, the Club’s business manager inspected the area of the fifth hole but did not see “any bees or yellow jackets” or locate “anything that looked like any type of hive or nest.” The following day, at the manager’s request, a Clark employee also conducted an inspection after Dennis pointed out where the swarm attacked Staats. The Clark employee “walked around the area looking for a nest,” and “[a]fter looking for approximately fifteen minutes, [he] saw an underground hole about one and a half inches around. It was near the edge of a sand trap and had a partial lip of grass over the hole. There were about four to [five] yellow jacket/wasp[-]looking bees on the ground and about a dozen flying around.” The Clark employee sprayed the underground nest and left. Yellow jacket traps were also placed near the fifth hole.

Staats filed this lawsuit in September 2014, asserting causes of action for general negligence and premises liability. The Club moved for summary judgment, claiming that it owed no duty to protect patrons from “an attack by a wild swarm of insects without … prior knowledge of [the swarm’s] residence, congregation[,] or injury[-]producing behavior.” The trial court granted the motion, finding that the Club “had no duty to protect against the risk in this case” because of the Club’s “lack of knowledge” of “swarming yellow jackets or subterranean yellow jacket nests on the golf course fairway.” The court entered final judgment for the Club in October 2015.

832*832 II. Discussion

A. Standard of Review.
A motion for summary judgment is properly granted if “there is no triable issue as to any material fact and … the moving party is entitled to a judgment as a matter of law.” (Code Civ. Proc., § 437c, subd. (c).) A defendant moving for summary judgment must present evidence that either “conclusively negate[s] an element of the plaintiff’s cause of action” or “show[s] that the plaintiff does not possess, and cannot reasonably obtain,” evidence necessary to establish an element of the claim. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 853, 854 [107 Cal.Rptr.2d 841, 24 P.3d 493].) If the defendant meets this burden, “the burden shifts to the plaintiff … to show that a triable issue of one or more material facts exists as to the cause of action or a defense thereto.” (Code Civ. Proc., § 437c, subd. (p)(2).)

We review the record de novo, “liberally construing the evidence in support of the party opposing summary judgment and resolving doubts concerning the evidence in favor of that party.” (Miller v. Department of Corrections (2005) 36 Cal.4th 446, 460 [30 Cal.Rptr.3d 797, 115 P.3d 77].) “We affirm the trial court’s decision if it is correct on any ground the parties had an adequate opportunity to address in the trial court, regardless of the reasons the trial court gave.” (Jameson v. Pacific Gas & Electric Co. (2017) 16 Cal.App.5th 901, 909 [225 Cal.Rptr.3d 171].)

B. The Relevant Issue Is Whether the Club’s Duty To Keep Its Premises Reasonably Safe Includes Protecting Patrons from Yellow Jacket Nests.
(2) “The elements of a negligence claim and a premises liability claim are the same: a legal duty of care, breach of that duty, and proximate cause resulting in injury.” (Kesner v. Superior Court (2016) 1 Cal.5th 1132, 1158 [210 Cal.Rptr.3d 283, 384 P.3d 283] (Kesner).) Unlike the elements of breach, causation, and injury, all of which are fact-specific issues for the trier of fact, the existence and scope of a duty are questions of law. (Id. at pp. 1142, 1144; Alcaraz v. Vece (1997) 14 Cal.4th 1149, 1162, fn. 4 [60 Cal.Rptr.2d 448, 929 P.2d 1239].)

Under Civil Code section 1714, “[e]veryone is responsible, not only for the result of his or her willful acts, but also for an injury occasioned to another by his or her want of ordinary care or skill in the management of his or her property or person, except so far as the latter has, willfully or by want of 833*833 ordinary care, brought the injury upon himself or herself.” (Civ. Code, § 1714, subd. (a).) The statute “`establishes the general duty of each person to exercise, in his or her activities, reasonable care for the safety of others.'” (Kesner, supra, 1 Cal.5th at p. 1142.) Where, as here, there is no “`statutory provision establishing an exception to the general rule of Civil Code section 1714, courts should create one only where “clearly supported by public policy.”‘” (Id. at p. 1143.)

(3) As a consequence of this general duty, those who own or occupy property[2] have a duty to maintain their premises in a reasonably safe condition. (Ortega v. Kmart Corp. (2001) 26 Cal.4th 1200, 1205 [114 Cal.Rptr.2d 470, 36 P.3d 11] [store proprietor]; Alcaraz v. Vece, supra, 14 Cal.4th at p. 1156 [possessor of land]; see also Morgan v. Fuji Country USA, Inc. (1995) 34 Cal.App.4th 127, 134 [40 Cal.Rptr.2d 249] [duty of golf course operator “to provide a reasonably safe golf course”].) To comply with this duty, a person who controls property must “`”`inspect [the premises] or take other proper means to ascertain their condition'”‘” and, if a dangerous condition exists that would have been discovered by the exercise of reasonable care, has a duty to give adequate warning of or remedy it. (Salinas v. Martin (2008) 166 Cal.App.4th 404, 412 [82 Cal.Rptr.3d 735], italics omitted; see also Ortega, at pp. 1206-1207; Chance v. Lawry’s, Inc. (1962) 58 Cal.2d 368, 373 [24 Cal.Rptr. 209, 374 P.2d 185].)

(4) “`”[D]uty” is a question of whether the defendant is under any obligation for the benefit of the particular plaintiff; and in negligence cases, the duty is always the same, to conform to the legal standard of reasonable conduct in … light of the apparent risk. What the defendant must do, or must not do, is a question of the standard of conduct required to satisfy the duty.'” (Coffee v. McDonnell-Douglas Corp. (1972) 8 Cal.3d 551, 559, fn. 8 [105 Cal.Rptr. 358, 503 P.2d 1366].) The Club does not deny that it owed Staats, a patron of its golf course, a duty to maintain its property in a reasonably safe condition. Rather, it contends that this duty “is limited when the harm at issue is caused by insects.” Thus, the issue presented “is not the existence of a duty … as such, or the class of persons to whom the duty extends, but the nature and scope of the acknowledged duty.” (Ramirez v. Plough, Inc. (1993) 6 Cal.4th 539, 546 [25 Cal.Rptr.2d 97, 863 P.2d 167].)

(5) To assess the scope of a duty, a court must “identify the specific action or actions the plaintiff claims the defendant had a duty to undertake. `Only after the scope of the duty under consideration is defined may a court meaningfully undertake the balancing analysis of the risks and burdens present in a given case to determine whether the specific obligations should 834*834 or should not be imposed.'” (Castaneda v. Olsher (2007) 41 Cal.4th 1205, 1214 [63 Cal.Rptr.3d 99, 162 P.3d 610].) Here, Staats claims that the Club had a duty to protect patrons from yellow jacket nests, including underground nests, by inspecting for them and setting traps to prevent their formation. Our analysis is therefore limited to assessing whether the Club’s duty to maintain its property in a reasonably safe condition required the Club to take steps to keep the premises free of yellow jacket nests. (See Verdugo v. Target Corp. (2014) 59 Cal.4th 312, 336-337 [173 Cal.Rptr.3d 662, 327 P.3d 774].)

C. Decisions Involving Bites by Stray Insects Are Distinguishable.
In granting summary judgment in the Club’s favor, the trial court relied on two cases addressing liability for insect bites. The Club claims that these decisions are dispositive, but we disagree.

In the first decision, Brunelle v. Signore (1989) 215 Cal.App.3d 122 [263 Cal.Rptr. 415] (Brunelle), the Fourth District Court of Appeal considered a premises liability claim against the owner of a vacation home in which the plaintiff was bitten by a brown recluse spider. (Id. at p. 125.) The court held that “an owner or occupier of a private residence does not have a duty to protect [against] or prevent bites from harmful insects where: (1) it is not generally known that the specific insect is indigenous to the area; (2) the homeowner has no knowledge that a specific harmful insect is prevalent in the area where [the] residence is located; (3) the homeowner has on no occasion seen the specific type of harmful insect either outside or inside [the] home; and (4) neither the homeowner nor the injured guest has seen the specific insect that bit the guest either before or after the bite occurred.” (Id. at p. 129.) Under such circumstances, the injury was unforeseeable as a matter of law, the burden of preventing injury would be “enormous,” and “the task of defining the scope of the duty and the measures required of the homeowners would be extremely difficult.” (Id. at pp. 130, 125.)

In the second decision, Butcher v. Gay (1994) 29 Cal.App.4th 388 [34 Cal.Rptr.2d 771], the Fifth District Court of Appeal discussed Brunelle in ruling that a homeowner was not liable to a guest who claimed she had contracted Lyme disease after being bitten by a tick on the homeowner’s dog. (Butcher, at pp. 392, 401.) Butcher first concluded that there was a weaker factual basis for imposing a duty on the homeowner than there was in Brunelle because the insect at issue, the western black-legged tick, was not readily identifiable as inherently harmful as was the brown recluse spider in Brunelle. (Butcher, at pp. 402-403.) Evidence showed that the western black-legged tick rarely carried Lyme disease and was not easily distinguishable from other noncarrier species of ticks. (Id. at p. 403.) Butcher also concluded that, even if there were a duty to protect against such insects, the 835*835 guest’s claim would still fail because no evidence was presented that the homeowner had any actual or constructive knowledge that any ticks carrying Lyme disease were present on the premises. (Id. at p. 404.)

Shortly before oral argument in this case, the Fourth District Court of Appeal reversed a grant of summary judgment against a plaintiff who was seriously injured after being bitten by a black widow spider while eating lunch on a restaurant’s patio. (Coyle v. Historic Mission Inn Corp. (2018) 24 Cal.App.5th 627, 631 [234 Cal.Rptr.3d 330] (Coyle).) Determining that “[i]t [was] a matter of common experience and knowledge in this geographical area that black widow spiders are found inside and outside of buildings and that one must be careful to avoid being bitten by a black widow,” Coyle held that “[r]estaurant owners have a duty to exercise reasonable care in relation to black widow spiders posing a risk of injury to patrons on the restaurant premises.” (Id. at pp. 636, 639.)

In so holding, the Court of Appeal declined to endorse Brunelle’s comment that a duty to protect against a harmful insect could not be imposed if the defendant had never seen that insect on the property. (Coyle, supra, 24 Cal.App.5th at pp. 641-643; see Brunelle, supra, 215 Cal.App.3d at pp. 129-130.) Coyle suggested that Brunelle relied too much on “the specific facts of [the] case when analyzing the issue of duty” and effectively “usurp[ed] the jury’s role” of determining which actions the exercise of reasonable care requires. (Coyle, at p. 642.) Rather, the relevant issue is whether, “generically, not dependent on the facts of the case, … there [is] a duty of care,” and, if so, whether “the usual standard of reasonable care [should] apply.” (Ibid.) The facts of a case come into play in determining what measures are required to satisfy the standard of care. (Id. at pp. 642-643; see also id. at p. 641 [restaurant’s claim it was unaware of spiders on its property “will be relevant when arguing the meaning of `reasonable care’ to the trier of fact”].) Whether the measures taken by a defendant satisfied the duty of care can be determined as a matter of law when, but only when, the pertinent facts are not reasonably disputed. (Coyle, at pp. 642-643 & fn. 2.)

The Club contends that Brunelle and Butcher “reached … equivalent outcomes based on the same fundamental principle: a property owner owes no duty for harm caused by insects in the absence of actual and specific notice of the danger.” (Italics added.) As Coyle makes clear, however, it is improper to determine whether a duty exists based on the specific facts of the case, which include the extent of the defendant’s knowledge of the danger. It is true that in Coyle, black widow spiders had previously been observed on the restaurant’s property, and the Club’s position is thus arguably consistent with the decision’s holding, if not its reasoning. But even if Brunelle and 836*836 Butcher can be reconciled with Coyle, these decisions involved claims by plaintiffs bitten by individual insects whose source was unknown. In declining to hold that, absent any knowledge such insects were present in the area, homeowners had a duty to protect guests from them, Brunelle and Butcher never discussed whether the homeowners could have discovered the risk posed by the insects through a reasonable inspection of their property or minimized the risk through preventive measures.

In contrast, the swarm of yellow jackets that attacked Staats likely came from a condition on the Club’s premises, i.e., a nest. The Club disclaims any duty by characterizing it as one to prevent “a danger that did not exist” until the moment the swarm formed and became dangerous, but Staats’s claim is based on the Club’s alleged failure to inspect its premises to discover and eradicate yellow jacket nests. Brunelle and Butcher involved dangers posed by stray insects. Their holdings are not at odds with recognizing a duty of a property owner to protect against dangers posed by discrete conditions on the property, such as yellow jacket nests, from which dangerous insects emanate.[3]

D. The Club’s Duty To Keep Its Premises in a Reasonably Safe Condition Includes Protecting Patrons from Yellow Jacket Nests.
(6) We now turn to the central question of whether the scope of Club’s duty to keep its premises in a reasonably safe condition categorically does not include protecting patrons from yellow jacket nests. In determining whether public policy supports carving out an exception to the general duty of reasonable care, “the most important factors are `the foreseeability of harm to the plaintiff, the degree of certainty that the plaintiff suffered injury, the closeness of the connection between the defendant’s conduct and the injury suffered, the moral blame attached to the defendant’s conduct, the policy of preventing future harm, the extent of the burden to the defendant and consequences to the community of imposing a duty to exercise care with 837*837 resulting liability for breach, and the availability, cost, and prevalence of insurance for the risk involved.'” (Kesner, supra, 1 Cal.5th at p. 1143, quoting Rowland v. Christian (1968) 69 Cal.2d 108, 113 [70 Cal.Rptr. 97, 443 P.2d 561]; Castaneda v. Olsher, supra, 41 Cal.4th at p. 1213; Barnes v. Black (1999) 71 Cal.App.4th 1473, 1478 [84 Cal.Rptr.2d 634].) The Supreme Court has explained that “[t]he Rowland factors fall into two categories. Three factors — foreseeability, certainty, and the connection between the plaintiff and the defendant — address the foreseeability of the relevant injury, while the other four — moral blame, preventing future harm, burden, and availability of insurance — take into account public policy concerns that might support excluding certain kinds of plaintiffs or injuries from relief.” (Kesner, at p. 1145.)

1. Foreseeability factors.
(7) As we have mentioned, the existence and scope of a duty are questions of law, while breach, causation, and injury are fact-specific issues for the trier of fact. (Kesner, supra, 1 Cal.5th at p. 1142.) As a consequence, the analysis of foreseeability for purposes of assessing the existence or scope of a duty is different, and more general, than it is for assessing whether any such duty was breached or whether a breach caused a plaintiff’s injuries. “[I]n analyzing duty, the court’s task `”`is not to decide whether a particular plaintiff’s injury was reasonably foreseeable in light of a particular defendant’s conduct, but rather to evaluate more generally whether the category of negligent conduct at issue is sufficiently likely to result in the kind of harm experienced that liability may appropriately be imposed on the negligent party.'”‘” (Laabs v. Southern California Edison Co. (2009) 175 Cal.App.4th 1260, 1272-1273 [97 Cal.Rptr.3d 241] (Laabs), some italics added & omitted.) “The jury, by contrast, considers `foreseeability’ in two more focused, fact-specific settings. First, the jury may consider the likelihood or foreseeability of injury in determining whether, in fact, the particular defendant’s conduct was negligent in the first place. Second, foreseeability may be relevant to the jury’s determination of whether the defendant’s negligence was a proximate or legal cause of the plaintiff’s injury.” (Ballard v. Uribe (1986) 41 Cal.3d 564, 573, fn. 6 [224 Cal.Rptr. 664, 715 P.2d 624].)

Staats argues that the relevant question here, “framed at the proper level of generality, is whether it is foreseeable that someone playing golf … might be attacked by a swarm of venomous stinging insects which have nested on the golf course in an area from which golfers will foreseeably play.” The Club frames the relevant question similarly, arguing that the issue is whether it is “foreseeable that an unknown, underground nest of yellow jackets might become agitated, form a swarm, and attack a patron.” Under both formulations, the focus is not on whether the Club knew or should have known about 838*838 the particular yellow jacket nest at issue or whether it was foreseeable that Staats would be attacked by a swarm emanating from it. Rather, the focus is on the more general question of whether it is foreseeable that a yellow jacket nest on the grounds might pose a danger to patrons.

(8) “Foreseeability supports a duty only to the extent the foreseeability is reasonable.” (Sturgeon v. Curnutt (1994) 29 Cal.App.4th 301, 306 [34 Cal.Rptr.2d 498].) When determining whether a particular category of harm is reasonably foreseeable, “`it is well to remember that “foreseeability is not to be measured by what is more probable than not, but includes whatever is likely enough in the setting of modern life that a reasonably thoughtful [person] would take account of it in guiding practical conduct.” [Citation.] One may be held accountable for creating even “`the risk of a slight possibility of injury if a reasonably prudent [person] would not do so.'”‘” (Laabs, supra, 175 Cal.App.4th at p. 1272, quoting Bigbee v. Pacific Tel. & Tel. Co. (1983) 34 Cal.3d 49, 57 [192 Cal.Rptr. 857, 665 P.2d 947].)

(9) The evidence presented here supports the conclusion that it was reasonably foreseeable that yellow jackets in an underground nest on the premises would form a swarm and attack a nearby golfer. In opposing the Club’s motion for summary judgment, Staats submitted the declaration of Lynn Kimsey, Ph.D., an entomologist at the University of California, Davis. Dr. Kimsey averred that “[y]ellow jackets are prevalent throughout Northern California, including [in the] Napa Valley.” “Abandoned gopher holes, ground squirrel holes[,] and rabbit burrows are favored areas for [yellow jacket] nests,” and “[i]t is eminently foreseeable” that yellow jackets will form nests in such locations on a golf course. Dr. Kimsey also stated that “[y]ellow jackets aggressively protect their nest if they feel it is threatened” and that “[t]he only time yellow jackets behave [en masse]” as they did to attack Staats “is very near the nest entrance, to protect it, usually within ten feet or so of the entrance to the nest.” Staats also submitted the declaration of a provider of pest control services who had treated underground yellow jacket nests at other golf courses in Northern California, including one in Napa Valley. Finally, Club employees acknowledged they had previously seen yellow jackets on the course.

(10) The Club claims that the danger was not foreseeable because no danger existed “until the underground nest became agitated and produced a swarm of yellow jackets.” But the question is whether it is reasonably foreseeable that a nest of yellow jackets — i.e., a condition existing on the premises — might produce a swarm that would attack a patron. Contrary to the Club’s position, a danger does not have to “previously manifest” to be foreseeable. “`”[T]he mere fact that a particular kind of an accident has not happened before does not … show that such accident is one which might not 839*839 reasonably have been anticipated.” [Citation.] Thus, the fortuitous absence of prior injury does not justify relieving [a] defendant from responsibility for the foreseeable consequences of its acts.'” (Lawrence v. La Jolla Beach & Tennis Club, Inc. (2014) 231 Cal.App.4th 11, 31 [179 Cal.Rptr.3d 758].) In any event, because we must assess whether the presence of nests on a golf course creates a general risk of foreseeable injury — i.e., the possibility that yellow jackets will swarm and attack a golfer — we find it of marginal importance that the Club claims it was unaware of any previous swarm or sting. (See Laabs, supra, 175 Cal.App.4th at p. 1273 [where defendant “sought summary judgment solely on the ground that it `owed no duty’ as a matter of law,” court “not concerned with … `more focused, fact-specific’ inquiries” involving defendant’s conduct in particular].)

Moreover, Staats presented evidence that the Club, like the defendant in Coyle and unlike the defendants in Brunelle and Butcher, was aware that yellow jackets could be found in the area, and specifically on the golf course. The Club says it could not anticipate the level of danger without consulting with “a trained expert to determine when, how, and where a yellow jacket swarm might form and launch an attack.” But it is common knowledge that yellow jackets live in nests and are dangerous in large numbers, and people generally avoid these nests for fear of being stung. Even without knowing the specific reasons why swarms form, reasonable people can foresee that a yellow jacket nest could cause injuries.

(11) The other two factors related to foreseeability of the injury also weigh in favor of finding a duty. “The second Rowland factor, the degree of certainty that the plaintiff suffered injury, `has been noted primarily, if not exclusively, when the only claimed injury is an intangible harm such as emotional distress'” or where there are “concerns about the existence of a remedy.” (Kesner, supra, 1 Cal.5th at p. 1148.) Here, there is no dispute that Staats suffered an injury that is “certain and compensable under the law.” (Ibid.) “The third Rowland factor, `”the closeness of the connection between the defendant’s conduct and the injury suffered[,]” [citation] is strongly related to the question of foreseeability itself'” and generally is relevant when intervening third party conduct caused the injury. (Ibid.) Here, to the extent the forming of a yellow jacket swarm can be analogized to such conduct, we have already discussed why it is reasonably foreseeable that a nest of yellow jackets might cause injury to golfers.

2. Policy factors.
Having concluded that it is reasonably foreseeable that a yellow jacket nest on a golf course could cause injury, we turn to weigh the “`”`policy considerations for and against [the] imposition of liability.'”‘” (Kesner, 840*840 supra, 1 Cal.5th at p. 1150.) We start by addressing the main policy factor the parties discuss, the burden on a golf course operator to comply with the duty of ordinary care in this context. (See Kesner, supra, 1 Cal.5th at p. 1152; see also Lawrence v. La Jolla Beach & Tennis Club, Inc., supra, 231 Cal.App.4th at pp. 23-24 [“primary considerations” when scope of duty is at issue “are the foreseeability of the harm and the burden on the defendant of protecting against the harm”].) The Club contends that a duty to protect its patrons from yellow jacket nests would impose an “immense burden of inspecting its entire outdoor property — including every hole, crevice, tree, shrub, etc. — for every conceivable danger that might someday come into being under precise circumstances. It is difficult to imagine the limits of such a duty — it would extent to every type of insect, rodent, bird, and other natural creature that could someday resort to its base instinct and harm a patron.” We are not convinced.

(12) To begin with, the issue here is whether a golf course operator has a duty to protect its patrons from the risk posed by yellow jackets nests, which are a condition on the premises, not whether it has a duty to protect against harm caused by wild animals more broadly. The existence of a duty to protect against the risk of other animals or insects will depend on a variety of factors, such as whether the animals or insects are inherently dangerous and whether their source is a condition on the premises.

In addition, the duty of a golf course operator to protect patrons from yellow jacket nests does not necessarily require the operator to inspect the “entire outdoor property,” much less “every hole, crevice, tree, [or] shrub.” As we have mentioned, the measures an operator must take to comply with the duty to keep the premises in a reasonably safe condition depend on the circumstances, and the issue is a question for the jury unless the facts of the case are not reasonably in dispute. (See Kesner, supra, 1 Cal.5th at p. 1144; Isaacs v. Huntington Memorial Hospital (1985) 38 Cal.3d 112, 131 [211 Cal.Rptr. 356, 695 P.2d 653]; Coyle, supra, 24 Cal.App.5th at pp. 640, 642-643 & fn. 2.)

The Club points to the declarations of its business manager and its grounds superintendent to support its claim that it would have to hire an additional employee to comply with the proposed duty. Both men stated that “[r]outine inspection of each and every hole, pipe, culvert, tree, depression and crevice on the course would require hiring” at least one additional ground crew member “whose sole job would be to inspect for flying insect nests [and] hives.” The business manager further averred that the costs of hiring one or more additional employees to perform such inspections “would be overwhelming and would threaten if not make [impossible] continued operation.” 841*841 But evidence addressing the economic burden of inspecting every conceivable place a nest might form is unhelpful in assessing the burden of finding a duty to exercise reasonable care in keeping golf course patrons safe.

Staats maintains that the risk of yellow jacket attacks can be significantly mitigated through setting traps, and she accurately observes that the Club has not shown “that retaining a pest control service to regularly inspect for and treat insect nests is somehow prohibitively expensive for a golf course.” She points to the declaration of the pest control services provider, in which he stated that for several years he provided pest control services for a resort in the Napa Valley whose property included a golf course. Because the resort “did not like yellow jackets flying around,” he “instituted a program to stop the nests at early stages” by setting up “bait stations with a mixture of hamburger and pesticides. The yellow jackets would take the hamburger back to the underground nests and feed it to the larvae. This would poison them and prevent the proliferation of more yellow jackets.” He had also treated several nests discovered at the resort and at other golf courses in the Bay Area, including those discovered “by grounds[]keeper personnel who saw them while mowing the lawn in the fairways.”

The Club does not claim that retaining a pest control service to eradicate existing yellow jacket nests would be particularly costly, and as we have said, its evidence about the cost of inspections addresses only the unreasonable scenario under which it would have to meticulously comb through the entire premises looking for hidden nests. The Club also maintains that the claim its existing personnel “could simply install traps” is “devoid of merit” because “[t]here is no evidence in the record that installation of traps would eradicate entire nests, as opposed to isolated yellow jackets.” While it may be true that traps would not remove the danger posed by existing nests, there is evidence that traps would prevent the formation of new nests, significantly reducing the risk to patrons. In sum, there is no basis in the record for us to conclude that a duty to exercise reasonable care in protecting patrons from yellow jacket nests would impose a heavy burden on golf course operators.

(13) The remaining policy-related Rowland factors do not weigh in favor of carving out an exception to the duty of golf course operators to keep their premises reasonably safe. Most importantly, the policy of preventing future harm supports imposing the cost of injuries on the operators. “In general, internalizing the cost of injuries caused by a particular behavior will induce changes in that behavior to make it safer.” (Kesner, supra, 1 Cal.5th at p. 1150.) The Club does not dispute that protecting people from serious injury or even death is an important policy, and it does not point to any “`laws or mores indicating approval of the conduct or … undesirable consequences of allowing potential liability'” in relation to the community’s interest. (Ibid.) 842*842 Relatedly, the factor of moral blame weighs against creating an exception for yellow jacket nests because golf course operators are in a better position to protect against the risk posed by nests on their premises than golfers are. (See id. at p. 1151 [appropriate to assign moral blame “where the defendants exercised greater control over the risks at issue”].) And although there is no evidence in the record about the availability or cost of insuring against the risk, we find it hard to believe that golf courses would have excessive difficulty procuring insurance coverage to cover injuries to their patrons from yellow jacket attacks. (See Coyle, supra, 24 Cal.App.5th at p. 638.)

(14) Finally, the Club contends that we should hesitate to “impos[e] a legal duty that a landowner must find and kill animals found on its natural property,” because “the law recognizes that animals are `living creatures’ and must be treated as such.” We recognize that the type of animal at issue may affect the policy considerations in weighing whether there is a duty to protect against the risk the animal poses. For example, the Legislature has enacted laws to protect bees because bees are important to the state’s welfare. (Food & Agr. Code, §§ 29000, 29100, subd. (a); see generally id., § 29000 et seq.) If an animal was endangered, or risked becoming endangered, that might also weigh against a duty that would in practice require killing the animal. The Club points to no law or other circumstance, however, suggesting yellow jackets need special protection. We agree with Staats that in this instance, the policy of protecting human life outweighs the policy of protecting animal life.

Having concluded that the Club had a duty to protect Staats from the risk posed by yellow jacket nests on its property, we perceive no other basis on which to affirm the grant of summary judgment. We agree with Staats that triable issues of material fact exist as to the other elements of her negligence claims, and the Club does not argue otherwise. In particular, which actions the Club should have taken to minimize the risk (including the extent of reasonable inspections), whether the Club did take those actions, and whether any failure to do so proximately caused Staats’s injuries are all questions for the trier of fact. We hold only that golf course operators are not exempted from exercising reasonable care to protect their patrons against the foreseeable risk posed by yellow jacket nests on their premises.

III. Disposition

The judgment is reversed, and the case is remanded for further proceedings consistent with this opinion. Appellant is awarded her costs on appeal.

Dondero, J., concurred.

843*843 BANKE, J., Concurring. —

I concur in the judgment. Given the uncontroverted record that the golf course in question is in an area where yellow jackets are endemic, there seems no question that, under established case law, the owner’s duty of care, as to at least the area of play, includes taking reasonable measures to protect against the formation of yellow jacket nests and to eradicate nests revealed by reasonable inspection of the property.

I write separately to observe that as the courts renew their focus on a “broad level of factual generality” in evaluating duty (Cabral v. Ralphs Grocery Co. (2011) 51 Cal.4th 764, 772 [122 Cal.Rptr.3d 313, 248 P.3d 1170]; accord, Kesner v. Superior Court (2016) 1 Cal.5th 1132, 1144-1143 [210 Cal.Rptr.3d 283, 384 P.3d 283]), we must remain mindful that facts can be articulated at such a heightened level of generality as to enter the realm of boundless foreseeability, which the duty analysis is intended to foreclose (Bily v. Arthur Young & Co. (1992) 3 Cal.4th 370, 397 [11 Cal.Rptr.2d 51, 834 P.2d 745]).[1] So, too, as the courts recognize that the facts of a “particular case” generally pertain to breach and causation, rather than to duty (Regents of University of California v. Superior Court (2018) 4 Cal.5th 607, 629-630 [230 Cal.Rptr.3d 415, 413 P.3d 656]; see Kesner, at p. 1144), we should anticipate that there will be cases where a fully developed record reveals that no reasonable finder of fact could conclude there was a breach of the duty of due care or that any breach thereof was the cause of the claimed injury, and summary judgment would be properly granted. (E.g., Peralta v. The Vons Companies, Inc. (2018) 24 Cal.App.5th 1030, 1034-1037; see Luna v. Vela (2008) 169 Cal.App.4th 102, 114 [86 Cal.Rptr.3d 588] [observing that reversal on assumption of risk and duty issues would not preclude summary judgment on fully developed record based on no breach or causation]; Smith v. St. Jude Medical, Inc. (2013) 217 Cal.App.4th 313, 322-323 [158 Cal.Rptr.3d 302]; Bozzi v. Nordstrom, Inc. (2010) 186 Cal.App.4th 755, 764-765 [111 844*844 Cal.Rptr.3d 910]; cf. Regents of University of California, at p. 634 [emphasizing “that a duty of care is not the equivalent of liability,” “[r]easonable care will vary under the circumstances of each case,” and the “[c]ourts and juries should be cautioned to avoid judging liability based on hindsight”].)

[1] The term “yellow jacket” refers to “[a]ny of various North American predatory social wasps.” (Oxford English Dict. Online (2018) [as of Aug. 1, 2018] [yellow jacket].)

[2] This opinion will variously refer to an owner or occupier of property as a property owner, a homeowner, or, as in the case of the Club, an operator of a business.

[3] Under the common law doctrine of ferae naturae, “a property owner owes an invitee no duty of care to protect him [or her] from wild animals indigenous to the area unless [the owner] reduces the animals to his [or her] possession, attracts the animals to the property, or knows of an unreasonable risk and neither mitigates the risk nor warns the invitee.” (Union Pacific Railroad Co. v. Nami (Tex. 2016) 498 S.W.3d 890, 897.) The doctrine precludes strict liability for injuries caused by wild animals, although how it applies to negligence claims is less clear. (See id. at p. 904 (dis. opn. of Johnson, J.) [“[U]nder the broad common law … there is not a current consensus about whether the ferae naturae doctrine eliminates any duty on the part of those who own or possess land to take reasonable action to warn persons on the land of, or protect them from, the risk of harm posed by wild animals or insects that might foreseeably come onto the land”].) Brunelle observed that the doctrine supported its holding but did not rely on it, noting that “there are no California cases which consider the issue.” (Brunelle, supra, 215 Cal.App.3d at p. 129, fn. 5.) Neither party addresses the applicability of the doctrine here, and we conclude that it does not immunize the Club from liability.

[1] In some contexts, the courts have continued to focus on particularized facts in determining whether a duty of due care is owed — for example, in connection with the criminal conduct of third parties in the absence of a “special relationship” (e.g., Castaneda v. Olsher (2007) 41 Cal.4th 1205, 1213-1214 [63 Cal.Rptr.3d 99, 162 P.3d 610]; see Wiener v. Southcoast Childcare Centers, Inc. (2004) 32 Cal.4th 1138, 1145-1151 [12 Cal.Rptr.3d 615, 88 P.3d 517]; Smith v. Freund (2011) 192 Cal.App.4th 466, 472-476 [121 Cal.Rptr.3d 427]; Melton v. Boustred (2010) 183 Cal.App.4th 521, 536-539 [107 Cal.Rptr.3d 481]; J.L. v. Children’s Institute, Inc. (2009) 177 Cal.App.4th 388, 396-399 [99 Cal.Rptr.3d 5]; Rinehart v. Boys & Girls Club of Chula Vista (2005) 133 Cal.App.4th 419, 430-435 [34 Cal.Rptr.3d 677]) and for injuries caused by a dog owned by someone other than the defendant (e.g., Chee v. Amanda Goldt Property Management (2006) 143 Cal.App.4th 1360, 1369-1372 [50 Cal.Rptr.3d 40]; Martinez v. Bank of America (2000) 82 Cal.App.4th 883, 890-892 [98 Cal.Rptr.2d 576]). Notably, in Castaneda, Justice Kennard both dissented and concurred. In her view, the majority improperly focused on particular facts of the case and confused the issue of duty with that of breach. (Castaneda, at pp. 1225-1229 (conc. & dis. opn. of Kennard, J.).) However, for policy reasons, Justice Kennard joined in holding that the owner of a mobilehome park owed no duty to refuse to rent space to a suspected gang member. (Id. at pp. 1229-1230 (conc. & dis. opn. of Kennard, J.).)