Abdallah Salamah and Tamara Salamah v. Spring Trails Community Association, Inc. ( 2019 )

In The
Court of Appeals
Ninth District of Texas at Beaumont
____________________
NO. 09-18-00051-CV
____________________
ABDALLAH SALAMAH AND TAMARA SALAMAH, Appellants
V.
SPRING TRAILS COMMUNITY ASSOCIATION, INC., Appellee
_______________________________________________________ ______________
On Appeal from the 410th District Court
Montgomery County, Texas
Trial Cause No. 17-09-11758-CV
________________________________________________________ _____________
MEMORANDUM OPINION
We issued our original memorandum opinion in this cause on December 6,
2018, and afterwards, the appellants filed a motion for rehearing en banc. The court
denies the motion; however, the panel withdraws its opinion and substitutes this
opinion in its place.
Abdallah Salamah and Tamara Salamah appeal from an interlocutory order
denying their motion to dismiss a suit their homeowners’ association brought against
1
them to enforce a restrictive covenant in the deed to their home. Spring Trails
Community Association, Inc. (the Association), the Salamahs’ homeowners’
association, sued them after they allegedly violated the Association’s demand to stop
operating a daycare business in their home. In response to the suit, the Salamahs
moved to have it dismissed based on the provisions in the Texas Citizens
Participation Act (TCPA). In the motion, the Salamahs claimed that the Association
sued in retaliation for their decision to exercise several of their First Amendment
rights.1
The Salamahs raise three issues in their brief. They argue: (1) the TCPA
applies to the Association’s suit, (2) the Association failed to meet its burden to show
that specific evidence existed supporting each of the elements of its claims, and (3)
they established that valid affirmative defenses barred the Association’s claims. 2 As
to the Salamahs’ first issue, we assume, without deciding, that the TCPA applies to
1
See Tex. Civ. Prac. & Rem. Code Ann. § 27.003(a) (West 2015) (providing
a party with a right to move to dismiss a legal action that “is based on, relates to, or
is in response to a party’s exercise of the right of free speech, right to petition, or
right of association”). We note that all of these rights are in the First Amendment.
See U.S. CONST. amend. I.
2
See Tex. Civ. Prac. & Rem. Code Ann. § 51.014(a)(12) (West Supp. 2018)
(permitting an interlocutory appeal from a trial court’s ruling denying motions to
dismiss, filed under the TCPA).
2
the Association’s suit. As for issue two, we hold the record contains clear and
specific prima facie proof supporting each element of the Association’s claims.
Regarding the Salamahs’ third issue, we hold the Salamahs failed to conclusively
show their affirmative defenses barred the Association from proceeding further on
its claims.
Background
In September 2017, the Association sued the Salamahs claiming that based on
the manner they were conducting a child daycare business in their home, they were
violating restrictions in their deed. Later, the Salamahs moved to dismiss the
Association’s claims, arguing that by suing, the Association had infringed on their
constitutional rights under the TCPA. 3 In their motion, the Salamahs acknowledged
that the deed to their home contains some restrictions, including one that restricts the
manner they may conduct a business in their home. In pertinent part, the restriction
that burdens the Salamahs’ deed provides:
Owner or Occupant may conduct business activities within the Single
Family Residence so long as: (a) the existence or operation of the
business activity is not apparent or detectable by sight, sound, or smell
from outside the Lot; (b) the business activity does not involve persons
coming onto the Properties who do not reside in the Properties or door-
to-door solicitation of residents of the Properties; and (c) the business
activity is consistent with the residential character of the Properties and
does not constitute a nuisance, or a hazardous or offensive use, or
3
See id. § 27.001-.011 (West 2015).
3
threaten the security or safety of other residents of the Properties as may
be determined in the sole discretion of the Board.
According to the Salamahs’ motion, the Association could not enforce the
restriction because they had been running a daycare business in their home for years,
the Association’s Board knew what they were doing, and the manner they were
conducting the daycare business did not violate the restrictions in their deed. In the
trial court, the Salamahs argued that the Association sued them for three reasons: (1)
to retaliate against Abdallah for having criticized the Board about how it was being
managed, (2) to punish Abdallah for having participated in a recall petition of the
Board, and (3) to punish Abdallah for having announced that he was seeking a
position on the Board. According to the Salamahs, the circumstances surrounding
the Board’s decision authorizing the Association’s suit shows that the Board had
retaliated against them by filing suit to punish them for exercising their First
Amendment rights. Additionally, the Salamahs assert that the Association’s claims
should have been dismissed because they proved the Association’s claims were
barred by affirmative defenses. In response, the Association argued that its
motivation in filing suit was not retaliatory, but that it filed suit so that it could pursue
its own legal rights to enforce the restrictions in the Salamahs’ deed.
4
The trial court conducted a hearing on the Salamahs’ motion to dismiss in
December 2017. 4 About four weeks later, the trial court denied the motion. After
that, the Salamahs appealed and filed a brief. The Salamahs’ brief concludes the trial
court’s order denying their motion to dismiss should be reversed.5 They also contend
4
The record does not include a court reporter’s record from the hearing on
the motion to dismiss. On this record, we presume the parties presented no additional
evidence in the hearing except for the evidence on file with the District Clerk when
the hearing occurred. See Michiana Easy Livin’ Country, Inc. v. Holten, 168 S.W.3d
777, 783 (Tex. 2005) (explaining that appellate courts, absent indications showing
otherwise, generally presume that any pretrial hearings were non-evidentiary and
that the only evidence the trial court considered in deciding the matter is that
evidence that had been filed with the clerk). Here, the trial court considered the
following evidence when it ruled on the Salamahs’ motion: (1) the Association’s
petition for injunctive relief and civil damages, which included an affidavit signed
by a homeowner who lives in Spring Trails; (2) the declaration of covenants,
conditions and restrictions on Spring Trails homes; (3) minutes from the Board’s
May 2017 meeting; (4) an affidavit from the Association’s agent, which establishes
that the Salamahs’ home is in Spring Trails and governed by restrictions that address
the rights of homeowners to operate businesses in their homes; (5) an affidavit from
the Association’s attorney, which addressed the attorney’s fees the Association
incurred for responding to the Salamahs’ motion to dismiss; (6) two affidavits signed
by Abdallah, with exhibits, containing his account of the circumstances that existed
when the Association sued; (7) an affidavit signed by Tamara, with exhibits, which
is consistent with Abdallah’s affidavits about what she believes led to the suit; (8)
an affidavit signed by Raul Rodriguez, a member of the Board, stating that, in his
opinion, the business the Salamahs operate from their home is not a nuisance; (9) an
affidavit signed by the Salamahs’ attorney, stating the amount of the fees the
Salamahs incurred in prosecuting their motion to dismiss; and (10) an affidavit
signed by Louis Di Stefano, a former member of the Board, with exhibits, which
explain that Abdallah signed a petition favoring the Board’s recall before the
Association sued.
5
See Tex. Civ. Prac. & Rem. Code Ann. § 51.014(a)(12).
5
the Association’s suit should be dismissed. We note our jurisdiction over the parties
and the appeal.6
Standard of Review
Appellate courts use a de novo standard when reviewing rulings on motions
to dismiss that are subject to the statutory requirements in the TCPA. 7 In reviewing
rulings denying such motions, appellate courts consider the pleadings and the
evidence the trial court considered when the trial court decided the motion.8
The TCPA contains a two-step procedure to expedite the dismissal of claims
that a party has filed to intimidate or to silence another from exercising their First
Amendment rights.9 First, a defendant relying on the TCPA to seek a dismissal of a
plaintiff’s suit must show, by a preponderance of the evidence, that the claim “is
based on, relates to, or is in response to the [defendant’s] exercise of: (1) the right of
6
See id. § 27.008(a).
7
See id. § 27.006; see also Shipp v. Malouf, 439 S.W.3d 432, 437 (Tex.
App.—Dallas 2014, pet. denied); Rehak Creative Servs., Inc. v. Witt, 404 S.W.3d
716, 726 (Tex. App.—Houston [14th Dist.] 2013, pet. denied).
8
See Tex. Civ. Prac. & Rem. Code Ann. § 27.006; In re Lipsky, 460 S.W.3d
579, 587 (Tex. 2015).
9
ExxonMobil Pipeline Co. v. Coleman, 512 S.W.3d 895, 898 (Tex. 2017); see
also Tex. Civ. Prac. & Rem. Code Ann. § 27.003.
6
free speech; (2) the right to petition; or (3) the right of association.” 10 Second, if the
defendant moving for dismissal shows that the plaintiff’s claims implicate the
defendant’s First Amendment rights, the burden shifts to the party that filed the suit,
to establish by clear and specific evidence a prima facie case for each essential
element of the claim the defendant has challenged in its motion. 11
Analysis
For convenience, we address the Salamahs’ second issue before addressing
their other issues. In issue two, the Salamahs argue the Association failed to present
the trial court with prima facie proof that the business they operate in their home
violates the restrictions in their deed. Before analyzing issue two, we note the
Salamahs do not dispute that the declarations governing their right to operate a
10
Tex. Civ. Prac. & Rem. Code Ann. § 27.005(b); see Coleman, 512 S.W.3d
at 898.
11
Tex. Civ. Prac. & Rem. Code Ann. § 27.005(c); see Coleman, 512 S.W.3d
at 899. A prima facie case “is the ‘minimum quantum of evidence necessary to
support a rational inference that the allegation of fact is true.’” Lipsky, 460 S.W.3d
at 590 (quoting In re E.I. DuPont de Nemours & Co., 136 S.W.3d 218, 223 (Tex.
2004) (per curiam)). “The words ‘clear’ and ‘specific’ in the context of this statute
have been interpreted respectively to mean, for the former, unambiguous, sure, or
free from doubt and, for the latter, explicit or relating to a particular named thing.”
Id. at 590 (internal citations omitted). For these reasons, a party may not simply rely
on “notice pleading—that is, general allegations that merely recite the elements of a
cause of action[;]” instead, the party must “provide enough detail to show the factual
basis for its claim.” Id. at 592-93.
7
business in their home were duly filed.12 Nor do the Salamahs dispute that their deed
contains a restriction burdening how they may conduct a business in their home. 13
One of the provisions in the declarations addresses how the Board is to
determine whether a homeowner’s operation of a home-based business violates the
restrictions in the deeds to the homes in Spring Trails. According to the declarations,
whether a homeowner’s business violates a restriction is “determined in the sole
discretion of the Board.” The declarations also allow the Association to maintain
lawsuits to enforce restrictions like the one at issue in this appeal. Although the
Salamahs allege the Association failed to promptly sue them to enforce the deed and
thereby waived its right to enforce the restriction, the declarations provide that the
“failure of the Association to enforce such provisions shall in no event be deemed a
waiver of the right to do so thereafter.”
12
The record before the trial court includes a copy of the declarations. The
last page of the declarations shows that the declarations were filed in Montgomery
County’s real property records in October 2002.
13
Under the Texas Property Code, “restrictive covenant” is defined as “any
covenant, condition, or restriction contained in a dedicatory instrument, whether
mandatory, prohibitive, permissive, or administrative.” Tex. Prop. Code Ann. §
202.001(4) (West 2014). Under Texas law, “restrictive covenants are subject to the
general rules of contract construction.” Pilarcik v. Emmons, 966 S.W.2d 474, 478
(Tex. 1998).
8
Under the Texas Property Code, a homeowners’ association may exercise
“discretionary authority” to enforce a restrictive covenant, and if it does so, the
Association’s conduct is presumably “reasonable[,] unless the court determines by
a preponderance of the evidence that the exercise of discretionary authority was
arbitrary, capricious, or discriminatory.” 14 The evidence the Association presented
in response to the Salamahs’ motion shows that the Association filed a facially valid
claim seeking to have a factfinder determine whether the Salamahs were operating
a daycare business in a manner that violated the restrictions in their deed. For
example, the evidence the Association filed when it responded to the Salamahs’
motion reveals that the Association conducted an investigation into the manner the
Salamahs were operating their business. Included in the Association’s evidence is
an affidavit signed by a homeowner in Spring Trails. The homeowner’s affidavit
reflects that the homeowner personally observed the Salamahs’ daycare operation:
the individual who signed the affidavit states that the business constitutes “a
nuisance that affects my ability to enjoy my property.”
Following the investigation, three of the five members of the Association’s
board voted to turn the matter over to an attorney to file legal proceedings so the
14
Tex. Prop. Code Ann. § 202.004(a) (West 2014).
9
restriction in the deed restricting home-based businesses could be enforced. Finally,
the evidence the Association filed in the trial court shows that the Association sued
the Salamahs after the Board retained an attorney to sue the Salamahs on the
Association’s behalf.15
While the Salamahs raise several arguments to suggest that the Association
failed to present sufficient evidence to show the Association’s claims have merit,16
the evidence before the trial court allowed it to conclude that the Association has
prima facie proof to establish the elements needed to prove its case. For that reason,
we overrule that arguments the Salamahs advance in their second issue.
In issue three, the Salamahs argue they have established affirmative defenses
that bar the Association from having a factfinder determine whether the
15
Id. § 209.0051(h)(4) (West Supp. 2018) (requiring board action before a
property owners’ association may file suit to enforce a restriction of the type at issue
here).
16
For example, the Salamahs suggest that the Association failed to prove that
it suffered any damages, one of the elements of its claims. Under the Texas Property
Code, however, a trial court may assess “civil damages for the violation of a
restrictive covenant in an amount not to exceed $200 for each day of the violation.”
See id. § 202.004(c) (West 2014). Thus, the Association’s right to recover civil
damages does not depend on the Association proving that actual damages resulted
from the type of violation at issue in the suit. See Uptegraph v. Sandalwood Civic
Club, 312 S.W.3d 918, 937-38 (Tex. App.—Houston [1st Dist.] 2010, no pet.).
10
Association’s claims have merit. 17 The evidence in the record, however, shows that
fact issues exist on whether the violations the Association complains about in the
suit have been continuous or whether the violations complained about occurred
within the statutorily prescribed period for filing suit.18 Here, it is the manner in
which the Salamahs operate their home business that the Association claims violated
the restrictions, and whether and when the violations occurred (and whether such
violations were continuous) are fact issues that must be decided in a trial in order for
a court to determine if the statute of limitations applies. 19 While the Salamahs also
raised waiver and estoppel as affirmative defenses to the Association’s suit, we note
17
See Tex. Civ. Prac. & Rem. Code Ann. § 27.005(d) (West 2015) (providing
that, even if the nonmovant’s establishment of a prima facie case on its claim, “the
court shall dismiss a legal action against the moving party if the moving party
establishes by a preponderance of the evidence each essential element of a valid
defense to the nonmovant’s claim”).
18
The statute of limitations for a lawsuit to enforce deed restrictions is four
years. See Tex. Civ. Prac. & Rem. Code Ann. § 16.051 (West 2015); see also Girsh
v. St. John, 218 S.W.3d 921, 925 (Tex. App.—Beaumont 2007, no pet.).
19
See Fox v. O’Leary, No. 03-11-00270-CV, 2012 WL 2979053, at *6 (Tex.
App.—Austin July 10, 2012, pet. denied) (mem. op.) (explaining that “once a
violation of a restrictive covenant has ceased, the enforceability of the restrictive
covenant is renewed, and limitations does not bar enforcement of any future
violations”); Daniels v. Balcones Woods Club, Inc., No. 03-03-00310-CV, 2006 WL
263589, at *5 (Tex. App.—Austin Feb. 2, 2006, pet. denied) (mem. op.) (“When a
restrictive covenant is initially violated, but that violation ceases, limitations does
not bar future enforcement of the covenant.”).
11
the declarations that burden the Salamahs’ deed provide that the Association’s
failure to enforce a restriction “shall in no event be deemed a waiver of the right to
do so thereafter.” For these reasons, the Salamahs failed to conclusively show that
their affirmative defenses barred the Association’s claims. 20 We overrule issue
three.
Conclusion
The Legislature enacted the TCPA to “summarily dispose of lawsuits
designed” to chill First Amendment rights, but it did not design the statute “to
dismiss meritorious lawsuits.”21 We have assumed the TCPA applies to the
circumstances of this case, so we need not address the arguments the Salamahs raise
in their first issue.22 For the reasons explained above, we affirm the trial court’s order
denying the Salamahs’ motion to dismiss.
AFFIRMED.
_________________________
HOLLIS HORTON
Justice
20
See Tex. Civ. Prac. & Rem. Code Ann. § 27.005(d).
21
Lipsky, 460 S.W.3d at 589.
22
See Tex. R. App. P. 47.1 (allowing the court of appeals to limit its discussion
of the issues to resolving the issues that are necessary to the court’s final disposition
of the appeal).
12
Submitted on June 27, 2018
Opinion Delivered February 21, 2019
Before McKeithen, C.J., Horton and Johnson, JJ.
13