Filed 10/31/13 Keilholtz v. Hertel CA4/1 NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. COURT OF APPEAL, FOURTH APPELLATE DISTRICT DIVISION ONE
STATE OF CALIFORNIA

ROBERT KEILHOLTZ et al., Plaintiffs and Appellants,

v. ROGER EDWIN HERTEL, Defendant and Respondent. D061198

(Super. Ct. No. 37-2009-00051748-CU-NP-NC)

APPEAL from a judgment of the Superior Court of San Diego County, Robert P. Dalquist, Judge. Affirmed. George McGill for Plaintiffs and Appellants. Tharpe & Howell, Christopher Sherrill Ma ile and Eric B. Kunkel for Defendant and Respondent.2 I. INTRODUCTION Plaintiffs Robert Keilholtz et al. (plaintiffs) 1 appeal a judgment entered in favor of defendant Roger Edwin Hertel after the tria l court granted Hertel's motion for summary judgment. Plaintiffs, all of whom are hom eowners of individual condominium units in the Las Brisas condominium complex, a mutu al benefit condominium development, filed suit against Hertel seeking damages for breach of professional negligence, fraud, and/or negligent misrepresentation. Hertel was the insurance ag ent for the nonprofit mutu al benefit corporation, comprised of the homeowners (the Associati on), for a period of time. The Association maintained an insuran ce policy through Truck Insurance Ex change (Truck) that protected against risks to both the common areas of the development as well as risks to the individual condominium units. This type of policy is known as an "all risk" policy. In May 2003, some members of the Association's Board asked Hertel how the Association could decrease its insurance costs. Hertel su ggested that the Association

1 According to the operativ e complaint, the named plain tiffs in this action include Keilholtz, Art Amberg, Lani Amberg, Joanne Oberlander, John Bernheisel, Carl Cannata, Olivia Cannata, Paula Capestro, Richard E. Cornwell, Frank Dilberto , Scott Dlugos, Jane Leigh Eden, George Duckworth, Maureen Du ckworth, Harvey Finkelstein, Maureen Finkelstein, Joseph Galante, Phran Galante, Ja ck Harris, Janet R. Harris, Shirley Hough, Sheila Johnson, Julius S. Kerekes, Grace J. Kerekes, Joseph Largen, George McGill, Robert L. Mendenhall, Fred Nasseri, Mitr a Nasseri, Orville "Tex" Newton, Shawna Aymont-Newton, Barbara E. Stangl-Phelps, Seymour Phillips, Barbara Phillips, Russell Russo, Carolyn S. Russo, Norman Schwar tz, Fay Schwartz, Gordon Sarret, John Schnurer, Caroline Schnurer, Jayne W. Sp encer, Erich Spillmann, Tiffany Spillman, and Jess Willson.3 could change its policy from an "all risk" policy to one that covered only the common areas of the development, and not the individual units. This type of policy is known as a "bare walls" policy. After this discussion, Hertel initiated a request with Truck to change the Association's insurance coverage from "all risk " to "bare walls." The parties dispute the circumstances under which this change requ est was initiated. There is no dispute, however, that Hertel sent the change request form to an employee of the Association's property management company for signature, and that it was that employee, and not any member of the Association's Board, who si gned the form authorizing the change in coverage. After receiving th e form, the insurance company implemented the change in coverage. Plaintiffs maintain that they di d not know that the change had been made. Within weeks of the po licy change from "all risk " to "bare walls," one of the units in the complex suffered water damage. Just over a month after the property da mage occurred, the Association held a meeting at which the membership discussed th e benefits and drawbacks of amending the Association's governing documents to change a provision of the Association's Covenants, Conditions & Restrictions (CC&Rs) which, a ccording to various statements made by some of those who were deposed in this case , required the Associati on to maintain an "all risk" policy. Hertel attended that meeting and did not mention that a change in the Association's policy from "all risk" to "bare walls" had al ready been effectuated. In the meantime, the Association filed a cl aim with Truck for the water damage to the unit in the complex. The claim was eventually denied on the ground th at the policy in4 effect at the time of the property damage did not cover losses to the homeowners' individual units. The homeowners whose unit had been damaged sued the Association, individual members of the Board, and the property management company for causes of action related to the failure to maintain "all risk" coverage, including breach of fiduciary duty, fraud, negligent misrepresentation, suppression of fact, constructive fraud, conspiracy, and violation of Civil Code section 1365, which imposes certain duties on common interest associations with respect to notifying members regarding insurance policies maintained by th e association. The action eventua lly settled, and, as part of the settlement, the Association agr eed to pay the homeowners' a ttorney fees related to the action in an amount to be determ ined by the court. In order to cover the attorney fees that the court ultimately awarded, the Associ ation imposed a special assessment on the remaining individual homeowners in the amount of $8,500 per unit. 2 In their action against Hertel, the individual homeowners s ought to recover this special assessment from Hertel under theories of professiona l negligence, fraud, and/or negligent misrepresentation. Hertel moved for summary judgment, or, in the alternative, su mmary adjudication, arguing, among other things, that he could no t be liable to plaintiffs for professional negligence because he ow ed no duty to the individual plai ntiffs. Specifically, Hertel

2 Although the opera tive complaint asserts that each plaintiff was "required to, and subsequently did, pay $8,500 each as assessed damages" and requests damages in the amount of $8,500 per plaintiff, it appears from another documen t in the record that the special assessment was imposed on a per-unit basi s. This would mean that plaintiffs who jointly own a single condom inium unit would have suffered a single $8,500 loss.5 maintained that his client wa s the Association, not the indi vidual plaintiffs, and that he was not in privity with the indi vidual plaintiffs and therefore, owed no duty to them. Hertel further argued that the lack of any du ty to the individual homeowners eliminated the possibility that they could recover agai nst him on their negligent misrepresentation claim. Finally, Hertel mainta ined that the evidence dem onstrated that some of the plaintiffs had learned of the coverage ch ange around the time of the full Association meeting in August and took no action as a resu lt, so they could not have justifiably relied on anything he said to them at that meeting. According to Hertel, th e fact that plaintiffs did nothing after learning of the change in insurance coverage made it impossible for them to prevail on their claims for fra ud and/or negligent misrepresentation. The trial court agreed with Hertel that he owed no duty to plaintiffs, and concluded that this eliminated the possib ility that plaintiffs could prevail on their professional negligence and negligent misr epresentation claims. The court also determined that plaintiffs' fraud claim fa iled because plaintiffs had not relied on statements that Hertel made at the August meeting, and thus, as a matter of law, they had suffered no damages as a result of his stat ements. The trial court granted summary judgment in Hertel's favor. We conclude that although Hertel may have owed a duty to the individual homeowners to prevent the kind of damage suffered by the Abramses , i.e., an uninsured property loss due to the elimination, without notice, of insurance coverage for their individual units, this duty does not extend so far as to require hi m to use due care to prevent the kind of damage that the plaintiffs in this case allege they have suffered.6 Because we conclude that the duty that He rtel owes to the i ndividual homeowners is limited to a duty to use due care with respect to protecting their insurable interests, and that the harm alleged in this action is not harm to plaintiffs' insurabl e interests, we affirm the judgment in favor of Hertel as to th e professional negligence cause of action. We also affirm the judgment in favor of Hertel with respect to the claims for fraud and negligent misrepresentation. Because these claims are ba sed on Hertel's conduct at a meeting that occurred after the individual condominium unit had already suffered a loss, and the only damages that pl aintiffs claim resu lt from the loss sustained by that unit and the subsequent litigation arising out of that loss, plaintiffs cannot esta blish that they were damaged by Hertel's failure to inform the homeowners at th at meeting about the change in the Association's insurance coverage. We therefore affirm the judgment in Hertel's favor with respect to the fraud and ne gligent misrepresentation claims.
II. FACTUAL AND PROCEDUR AL BACKGROUND
A. Factual background Hertel is an insurance agent appointed by Truck to sell and offer insurance services related to policies issu ed by Truck. Hertel serviced policies that the Association purchased from Truck between 1993 and May 2008, with the exception of a period of
time in 1996 and 1997. 3

3 Hertel apparently also serviced some individual insuranc e policies for various homeowners in the Las Brisas development.7 Under the Association's CC&Rs , the board of directors (the Board) was authorized to hire a property manager to assist the Bo ard in managing the Association and the La Brisas property. Between 20 00 and 2004, William Brooks, an employee of the Eugene Burger Management Corporation (EBMC), served as the property manager for the Association. One aspect of Brooks's duties as the property manager "was to deal with matters pertaining to the Association's insura nce coverage." Brooks "was the person who dealt with H[ertel] regarding the Association's insurance coverage." In March 2003, Truck issued an insurance policy to the Association. That policy was a "CONDOMINIUM PREMIER" policy, which provided for "all risk" coverage, including "condominium unit coverage." A specific endorsement for "UNIT COVERAGE" explained that the policy covered the individual units in the Las Brisas condominium development. Hertel attended a meeting of the Associa tion's Board on May 19, 2003. According to Hertel, members of the Board expressed concern about the rising costs of the Association's insurance premiums. Hertel suggested modifying the Association's policy to cover only "bare walls" as opposed to "all risk." He explained that such a change would reduce the premium. Hertel indicated that the CC&Rs might have to be amended to allow for such a change. What happened next is the subject of much dispute. Hertel contends that in June 2003, Board member Seymour Phillips called Hertel and aske d him to prepare a request to change the Association's po licy from "all risk" to "bare walls ." Phillips denied that this phone call occurred. Brooks, th e property manager, stated in a declaration that the Board8 president called Brooks and directed him to implement the change in the policy to "bare walls" coverage. What is not in dispute is that at some point after May 19, Hertel sent a policy change request form to Brooks indicating a change in the Association's coverage from "all risk" to the reduced coverage for "bare wa lls." Brooks signed the form and returned it to Hertel, who submitted it to Truck. The change altered the Marc h 2003 policy to the reduced "bare walls" coverage, retroactive to the date on which th e policy went into effect. Plaintiffs maintain th at they were not informed that this change had been made. On July 25, 2003, condominium owners Richard and Ronnie Abrams suffered a substantial water leak in their unit that cau sed damage to their condominium unit, as well as to common areas. The Association subm itted a claim for damages under its policy with Truck. Truck paid the portion of th e claim for damage to the common areas, but denied the portion of the claim relating the inte rior of the Abramses' unit, on the ground that the policy provided on ly "bare walls" coverage. On August 23, 2003, the Association held its annual meeting. The homeowners were still unaware that the Association's in surance coverage had been changed from "all risk" to "bare walls." Hertel was at the meeting and gave a presentation regarding the Association's insurance cove rage, including a discussion of the benefits to the Association of reducing their coverage from "a ll risk" to "bare walls." Hertel did not mention that the Association's insurance c overage had already been reduced from "all risk" to "bare walls," even wh en he was specifically asked whether any change to the Association's coverage had been made. Apparently, just prior to the meeting, Brooks had9 informed Hertel that the A ssociation's CC&Rs had not been amended to allow for "bare walls" insurance coverage. 4 No one else at the mee ting disclosed the reduction in insurance coverage to the general membership that night. Two days later, Hertel spoke with Brooks and told him how much it would cost to change the Association' s insurance coverage back to "all risk." On September 10, Hertel sent Brooks a written bid fo r changing the Association's policy back to "all risk" coverage. Brooks met with the Board on September 15. At that meeting, Brooks informed the Board members th at a change from "all risk " coverage to "bare walls" coverage had been implemented in June 2003. Because the change request initiated and implemented by Hertel and Brooks from an "all risk" policy to a "bare walls" policy had been implemen ted in contravention of the requirements of the Association's CC&Rs, on May 14, 2004, the Board voted to procure an "all risk" policy so that th e Association's insurance woul d be in compliance with the CC&Rs. Hertel prepared a policy change requ est form to procure "all risk" coverage for the Association, which was effective as of Ma y 13, 2004. The Board also sent a letter to the Association membership soliciting a vote to amend th e CC&Rs to allow for the Association to maintain only a "bare walls" policy. In the meantime, the Abramses retained counsel to represent them with respect to the wate r damage to their unit. In

4 Although a full copy of the La Brisas CC& Rs was never introduc ed in evid ence in the trial court, and, as a result, a full copy is not in the record on appeal, from statements made by various witnesses, it appears that th e CC&Rs required the Association to insure not only the common areas of the Las Bris as development, but also individual homeowners' units.10 November 2003, the Abramses' attorneys sent a demand lette r to the Association asking for damages in the amount of approximately $135,000 for remediation and construction costs. In July 2004, the Abramses' attorneys sent a second demand letter asking for approximately $170,000, includin g attorney fees. The Board apparently did not agree to pay the Abramses the amount of money that they were seeking. The Abramses proceeded to file a lawsuit against EBMC, the Associati on and some i ndividual Board members in March 2005. The Abrams litigation settled in May 2007. Pursuant to one term of the settlement, which was a pproved by the Board, the Associa tion agreed to pay any amount in excess of $70,000 that the court might aw ard on a motion for attorney fees and costs. 5 The trial court ultimately awarded the Abramses approximately $365,000 in attorney fees and costs, and entered judgment for that amount in their favor and against the Association. In order to pay the judgment, the Asso ciation imposed a special assessment of $8,500 per unit.

5 Under this term of the settlement agre ement, Truck, which was involved in the litigation as the Association's insurer, agreed to pay $70,00 0 in attorney fees, and the Association agreed to pay any additional amount of attorney fees and costs awarded to the Abramses in excess of $70,000.11 B. Procedural background Plaintiffs filed their original complain t in 2009. After various demurrers and motions to strike, plaintiffs ultimately filed the operativ e complaint, a third amended complaint (TAC), in November 2010. Hertel moved for summary judgment, or, in the alternative, su mmary adjudication. Plaintiffs opposed the motion. The trial court concluded that Hertel did not owe plaintiffs a duty of care, and that, as a matter of law, plaintiffs had not relied on Hertel's stat ements at the meeting and had suffered no damages as a result of his statemen ts. The court determined that plaintiffs thus could not prevail on their claims for professional negligence, negligent misrepresentation, or fraud. The trial court granted Hertel's motion for summary judgment, and entered judgment in favor of He rtel. Plaintiffs moved for a new trial, but the court denied the motion. Plaintiffs th ereafter filed a timely notice of appeal.
III. DISCUSSION Plaintiffs contend that the trial court erred in granting summary judgment in favor of Hertel because, they maintain, the trial co urt was incorrect in concluding that Hertel did not owe them a duty of care, as a matter of law, and there remained triable issues of fact with respect to all three of their claims against Hertel.12 A. Summary judgment standards A moving party is entitled to summary judgment when the party establishes that it is entitled to the entry of judgm ent as a matter of law. (C ode Civ. Proc., § 437c, subd. (c).) A defendant may make this showing by demonstrating that the plaintiff cannot establish one or more elements of all of his causes of action, or that the defendant has a complete defense to each cause of action. ( Towns v. Davidson (2007) 147 Cal.App.4th 461, 466.) "An issue of fact can only be created by a conflict of evidence. It is not created by 'speculation, conjecture, imaginat ion or guess work.' [Citation. ] Further, an issue of fact is not raised by 'cryptic, broadly phrased, an d conclusory assertions ' [citation], or mere possibilities [citation]. 'Thus, while the c ourt in determining a motion for summary judgment does not "try" the case, the court is bound to consider th e competency of the evidence presented.' [Citation.]" ( Sinai Memorial Chapel v. Dudler (1991) 231 Cal.App.3d 190, 196–197.) In reviewing a trial court's ruling on a mo tion for summary judgment, an appellate court makes " 'an independent assessment of the correctness of the trial court's ruling, applying the same legal standard as the tria l court in determining whether there are any genuine issues of material fact or whether th e moving party is entitled to judgment as a matter of law. [Citations.]' [Citation.]" ( Trop v. Sony Pictures Entertainment, Inc. (2005) 129 Cal.App. 4th 1133, 1143.)13 B. The professional negligence cause of action Plaintiffs contend that the trial court e rred in determining that that Hertel owed them no duty of care, as a matter of law. "The elements of a cause of action for professional negligence are (1) the existence of the duty of the professional to use such skill, pruden ce, and diligence as other members of the profession commonly posse ss and exercise; (2) breach of that duty; (3) a causal connection between the negligent conduct and the resulting injury; and (4) actual loss or damage resulting from the pr ofessional negligence. [Citation.]" ( Oasis West Realty, LLC v. Goldman (2011) 51 Cal.4t h 811, 821.)
1. Whether Hertel owed plaintiffs a duty of care that extends to the protection of their noninsurable economic interests Hertel contends that the trial court corr ectly concluded that he owed plaintiffs no duty, as a matter of law. Hertel further cont ends that the trial c ourt's decision to grant summary adjudication of this cl aim was correct because even if he owed plaintiffs a duty of due care, the evidence demonstrates, as a ma tter of law, that he did not breach that duty and/or that his actions were not the proximate cause of pl aintiffs' damages. There is no dispute that Hertel's client was the Association and not plaintiffs—the individual members who make up the Associa tion. The parties disagree as to whether Hertel owed the individual members of the A ssociation a duty of due care, such that he may be found liable to them with respect to the economic loss that they are claiming. "The threshold element of a cause of ac tion for negligence is the existence of a duty to use due care toward an interest of another that enjoys legal protection against14 unintentional invasion. [Citations.] Whether th is essential prerequisite to a negligence cause of action has been satisfied in a particul ar case is a question of law to be resolved by the court. [Citation.] [¶] A judicial conc lusion that a duty is present or absent is merely ' "a shorthand statement . . . rather than an ai d to analysis . . . . '[D]uty,' is not sacrosanct in itself, but only an expression of the sum total of those considerations of policy which lead the law to say that the particular plaintiff is entitled to protection." ' [Citation.] 'Courts, however, ha ve invoked the concept of du ty to limit generally "the otherwise potentially infi nite liability which would follow from every negligent act . . . ." ' [Citation.]" ( Bily v. Arthur Young & Co . (1992) 3 Cal.4th 370, 397 ( Bily ).) A duty of care may arise through statute, contract, the general character of the activity, or the relationship between the parties. ( J'Aire Corp. v. Gregory (1979) 24 Cal.3d 799, 803 ( J'Aire Corp. ).) "The determination whethe r in a specific case the defendant will be held liable to a third person not in privity is a matter of policy and involves the balancing of various factors , among which are the extent to which the transaction was intended to affect the plain tiff, the foreseeability of harm to him, the degree of certainty that the plaintiff suffe red injury, the closeness of the connection between the defendant's conduct and the injury suffered, the moral bl ame attached to the defendant's conduct, and the policy of pr eventing future harm. [Citations.]" ( Biakanja v. Irving (1958) 49 Cal.2d 647, 650 ( Biakanja ), italics added.)
In Biakanja , supra , 49 Cal.2d at pages 650-651, the Supreme Court permitted recovery by a third party bene ficiary, i.e., the intended beneficiary of a will prepared for the decedent by the defendant no tary public. The notary pub lic failed to have the will15 properly attested, rendering the will unenfor ceable. The Supreme Court concluded that the notary owed a duty to an intended beneficiar y, and not only to th e notary's client, to properly handle the will's dr afting and solemnization. ( Ibid .) Later, in J'Aire Corp., supra, 24 Cal.3d 799, the Supr eme Court applied the Biakanja factors to conclude that the tenant of a building used as a re staurant could state a cause of action for negligence against a renovation contractor hired by the building's owner for business income lost when the contractor "fail[ed] to complete the project with due diligence." ( J'Aire Corp., supra, at p. 802.) The Supreme Court held that a "special relationship" ( id. at p. 804) that permitted the re covery of economi c losses (i.e., the relationship defined by the Biakanja test) existed between the contractor and the tenant. The court dismissed concerns that such a theory of recovery would allow for the imposition of liability out of proportion to fault, for pote ntially remote consequences and speculative damages. ( J'Aire Corp., supra , at pp. 807-808.) In the court's view, the Biakanja factors, in combination w ith "ordinary principles of tort law such as proximate cause," were "fully adequate to limit recovery" of purely economic damages "without the drastic consequence of an abso lute rule which bars recove ry in all such cases." ( J'Aire Corp., supra, at p. 808.) In both Biakanja and J'Aire Corp ., the question that the courts addressed was whether the defendant's duty of care could be extended to a third party who was not in privity with the defendant—i.e., th e intended beneficiary of a will ( Biakanja , supra , 49 Cal.2d at pp. 648–649) and the lessee of pr emises that the defendant was renovating16 ( J'Aire Corp. , supra , 24 Cal.3d at p. 802)—for injuri es alleged to have been suffered by those third parties. To determine whether Hertel owed plainti ffs a legally recogniz ed duty to use due care to protect their interests in avoiding a" special assessment" to pay for the attorney fees award in the Abrams litigation, we will a pply the six factors identified in these cases. These six factors, however, do not end our inquiry as to whether Hertel owed a duty to use due care to protect the interest at stake in this case. In Bily, supra, 3 Cal.4th 370, the Supreme Court concluded that three additio nal factors should be considered in determining, in that case, whether accountants owed a general duty of care to investors who, in making their investments, fores eeably relied on an audit opinion that the investors alleged had been negligently prepar ed: 1) whether there existed the risk of imposition of liability out of proportion to fault; 2) the po ssibility that the plaintiff might take protective measures to guard against the risk (private ordering); and 3) whether it would be most efficient to place the loss on th e class of defendants involved rather than the plaintiffs. ( Id . at pp. 398-407.) Other courts have considered these additional Bily factors in determining whether a professional negligence claim may be brought by a third party not in privity with the de fendant for an injury alleged to have arisen as a result of the professional's lack of due care. (See Giacometti v. Aulla, LLC (2010) 187 Cal.App.4th 1133, 1137-1138 [concluding that an accounting firm does not have a duty of care to its client's employees when hired to prepare W-2 wage and tax statements for the client]; Weseloh Family Ltd. Partnership v. K.L. Wessel Construction Co . (2004) 12517 Cal.App.4th 152, 165-166, 170-172 [concluding that design engineers did not owe the property owner or the general co ntractor a duty of care].) The application of the combined nine Biakanja/Bily factors to determine whether a duty of care is owed to a particular third party who has suffered economic damages is a legal question that is decided on a case-by-case basis. (See Aas v. Superior Court (2000) 24 Cal.4th 627, 644; Mintz v. Blue Cross of California (2009) 172 Cal.App.4th 1594, 1610.) We consider th ese factors in turn.

a. The Biakanja factors i. The extent to which the transactio n was intended to affect the plaintiffs Citing Desert Healthcare District v. PacifiCare FHP, Inc. (2001) 94 Cal.App.4th 781, Hertel notes that in considering this firs t factor, "[t]he conduct alleged to have been negligent must have been intended to affect that particul ar plaintiff, rather than just a class of persons to whom the plaintiff happens to belong." ( Id . at p. 792.) Hertel asserts that because the "transaction in questi on was the processing of a request by the
Association to reduce the coverage offered by the Association's policy from 'all risk' to 'bare walls,' " the transaction was "not inte nded to affect the homeowners as individuals, but instead their association ." However, the record demons trates that the conduct that plaintiffs allege was negligent was intended to affect plain tiffs in this case. Hertel was the Association's insurance agen t and, in that capa city, assisted the Association in procuring insu rance policies to meet the Association's needs. In particular, Hertel assisted the Association in procuring and maintaining an insurance18 policy that specifically and directly affected each individual homeowner member of the Association. Prior to the change request at issue in this case, the Association's policy was an "all risk" policy. As such, the polic y provided coverage for each homeowner's individual unit, not only for the common areas owned by the homeowners collectively. Thus, the transaction at issue—Hertel's effect uation of a change inte nded to eliminate the coverage for the individual units— clearly was in tended to affect these plaintiffs, since it effectively eliminated the insu rance coverage that they had prior to the change. Because of the nature of the "all risk" policy, Hert el and everyone else involved in making a change from "all risk" to "bare walls" coverage , had to know that this transaction would specifically affect the individual homeow ners of the Las Brisas development by eliminating the insurance c overage for their units. Hertel acknowledges that where "a transac tion is in fact intend ed to specifically affect the plaintiff" there is "cause to consider a departure from the general rule that there is no duty to guard against economic loss. " However, Hertel maintains that the transaction was intended to affect the Asso ciation and not the individual homeowners. Although there is a legal distinction between the Association and its membership, it is disingenuous to suggest that the effect on the homeowners from the insurance change requested in this case was "mer ely collateral," as Hertel asse rts. The change did not affect only the insurance coverage for th e development's common areas, but rather, specifically eliminated each individual homeowner's insu rance coverage for his or her unit.19 Hertel cites Adelman v. Associated Internat. Ins. Co (2001) 90 Cal.App.4th 352, 366 ( Adelman ), as supporting his positio n with respect to this factor, however, our reading of the Adelman court's analysis suggests that it actually supports our conclusion with respect to this factor. Adelman addressed whether an insurer may "be subject to liability to a noninsured third party for the negligent performan ce of its indemnity obligations to the named insured based upon allegations that there is a 'special relationship' between the insurer and the third party, as that term has been defined and applied in [ Biakanja ] , supra , 49 Cal. 2d 647 and its progeny." ( Adelman , supra , at p. 359.) In Adelman , a homeowners' association (HOA) had procured an insurance policy that "provided coverage for losses from vari ous perils, including earthquake damage," and that "covered the common areas of the pr oject but did not extend coverage to the individual units owned by the plaintiffs." ( Id . at p. 356.) After the buildings in the complex suffered earthquake damage, the H OA made a timely and proper claim under the policy seeking the funds necessary to pa y to repair damage caused to the common areas of the project. However, the insura nce company failed to make the requested repairs or to provide the funds necessary to complete the repairs. ( Id . at p. 357.) Because these structural repairs had to be made before the individual homeowners could commence repairs to their individual units, the homeowners "were forced to incur the expense of finding other living quarters, or to live amidst disrepair, and suffered significant diminution in the value of their units." ( Ibid .) The individual homeowners sued the insuran ce company, seeking compensation for the expenses that they incu rred as a result of the insurance company's failure to timely20 and fully perform its obliga tions under the policy. ( Adelman , supra , 90 Cal.App.4th at pp. 357-358.) In assessing the Biakanja factors and applying them to the situation before it, the Adelman court concluded that issuance of the insurance policy in that case was not intended to affect the homeowners individua lly: "By its express terms, the policy, although purchased with plaintiffs' homeo wner assessment funds, covered only the

common areas of the project; in short, the policy wa s intended to protect the collective or group interests of the plaintiffs, not their individual interests. Plaintiffs do not credibly claim otherwise. The policy was purchased in the name of the HOA, which is the statutorily designated entity fo rmed to protect and enforce the plaintiffs' collective or group interests. . . . Given this circumstance , it can hardly be said that the 'end and aim' of the policy's purchase was the protection of plaintiffs' individual interests." ( Adelman , supra , at p. 366.) In contrast to the policy at issue in Adelman , the "all risk" policy that Hertel is alleged to have changed to a "bare walls" pol icy without proper authorization covered not only the common areas of the development but also each of the individual homeowners' units. The "all risk" policy in this case clearly was intend ed to protect not only the collective interests of the plaintiffs, but also their individual interests. Given the specific nature of the policy at issue, and the intende d effect of the change request, which was to eliminate entirely the protection for the home owners' individual units, we conclude that the first factor weighs in favor of finding the existence of a duty.21 ii. Foreseeability of harm to the plaintiffs The next factor we consider is whether th e harm that these plaintiffs suffered was foreseeable. It was clearly foreseeable that a change in the policy coverage from "all risk" to "bare walls" could cause harm to in dividual homeowners, particularly if the homeowners were not informed of the change. Plaintiffs would have had no reason to procure replacement insurance to protect thei r individual interests if they reasonably believed that the Association maintained an insurance policy that provided coverage for their units. Those persons who were involved in eliminating the coverage for plaintiffs' individual units could have foreseen that the individual homeowners might incur a loss that would not be covere d by the Association's ne w "bare walls" policy. However, the harm for which plaintiffs seek to recover in this case is not damage to any of their individual units. Rather, pl aintiffs seek compensa tion for the costs of litigation and a resulting settlement that was triggered by foreseeable damage to the Abramses' unit. The damage for which plaintiffs seek compensation is far less foreseeable than direct, unins ured property damage to a homeowner's individual unit. Multiple intervening events had to occur in order for these pl aintiffs to have suffered the damages that they are seeking to recover he re. Unlike the property damage suffered by the Abramses—damage to thei r unit that was uninsured due to the change in the Association's policy from "all risk" to "bare walls,"—the monetary damage suffered by plaintiffs was far less foreseeable. We conclude that, on the whole, this fa ctor weighs against imposing a duty on Hertel with respect to the damages th at plaintiffs seek in this case.22 iii. Degree of certainty that plaintiffs suffered injury Plaintiffs clearly suffered injury. While the CC&Rs requ ired that the Association maintain an insuran ce policy that covered both co mmon areas and the homeowners' individual units, the policy was changed with out proper amendment of the CC&Rs, and without plaintiffs' knowledge or consent. After the change occurred, one unit suffered physical damage. Because the Association' s policy had been changed, the Abramses, who owned the unit that sustained the damage , had no insurance to cover the costs to repair their unit. The Abrams es sued the Association, me mbers of the Board, and the property management company. As a result of that lawsuit, plaintiffs, all individual homeowners and members of the Association were required to pay a special assessment to cover a portion of the settlement reached in the Abrams litigation. This factor thus weighs in favor of finding a du ty owed by Hertel to plaintiffs to protect their interests under these circumstances. iv. Closeness of connection betwee n defendant's conduct and the injury suffered With respect to the closeness of th e connection between Hertel's acts and plaintiffs' injuries, Hertel's alleged initiation of the change request that eliminated the insurance coverage for the individual units in the Las Brisas community was clearly a causal factor of the Abramses' loss. However, the causal connection between Hertel's alleged conduct and the subsequent specia l assessment imposed on the Association's membership to pay for the Asso ciation's settlement of the Abrams litigation is far more attenuated.23 As Hertel argues, there is not a close connection between his ac tions and plaintiffs' injuries. The loss that plain tiffs incurred was a share of the cost of an open-ended settlement with the Abramses that the Board authorized af ter failing to settle on more favorable terms at an earlier point in the litig ation. If the Associ ation had handled the Abrams matter differently, there may have be en no need to impose an assessment on plaintiffs. Because Hertel's actions were not closely connected with the circumstances that led to the imposition of the special a ssessment, this factor weighs against a determination that Hertel owes plaintiffs a duty with respect to their injury.

v. The moral blame a ttached to defe ndant's conduct Hertel's alleged deviation from the sta ndard of care in his industry is not particularly blameworthy. His conduct did no t present a risk to health or safety, and, unlike the defendant's conduct in Biakanja , was not unlawful. The harm that Hertel's actions may have caused was solely economic. Hertel's conduct therefore does not stand out as morally blameworthy. This factor t hus weighs against finding that Hertel owed a duty to plaintiffs with respect to their injury. vi. The policy of preventing future harm The final Biakanja factor is the policy of preventing future harm. Where CC&Rs require that an HOA provide insurance covera ge that protects not only common areas but also the individual units of its members, one who assisted that HOA in procuring and maintaining such coverage knows that changi ng that coverage to "bare walls" coverage24 will impact those individual homeowners an d may have a potentially drastic affect on them. Plaintiffs allege that Hertel initiate d the change request without proper authorization, either at the suggestion of so meone who did not have the authority to make such a request, or out of a mistaken belief th at he had been asked to do so. Plaintiffs further allege that Hertel initiated the change knowing that the CC&Rs may have required the Association to maintain "all risk " coverage yet failing to determine whether the CC&Rs had been amended to allow for the elimination of individual unit coverage. If a fact finder determines that these allegations are true, impos ing liability coul d act as an incentive to others to ensure that such significant changes to HOA insurance policies are not effectuated unless such changes are reques ted by the appropriate individuals and there has been some minimal offer of proof that th e requested changes have been authorized by the governing documents and/or governing bo dy of that association. We therefore conclude that the policy of prev enting future harm weighs sli ghtly in favor of recognizing a duty on Hertel's part that extends beyond protecting only the plaintiffs' insurable interests, and that would impos e liability on him for failing to prevent the type of harm plaintiffs have alleged they suffered. b. The Bily factors i. The possibility that liability mi ght be imposed out of all proportion to fault The Bily court determined that imposing a dut y under the scenario presented in that case could have vastly e xpanded the number of possible plaintiffs and the types of25 claims against the auditor, thereby "rai s[ing] the spectre of multibillion-dollar professional liability that [wa]s distinctly out of proportion to" the auditor's fault and the connection between the a uditor's conduct and the investors' injury ( Bily , supra , 3 Cal.4th at p. 402). In this case, im posing a duty would not raise simi lar concerns. The nature of the duty that the plaintiffs in Bily sought to impose would have created potentially limitless exposure for the auditor, despite the fact that the aud itor's role in the financial reporting process was secondary, in that most of the information on which an auditor relies necessarily come s from the client, and involves complex professional judgment. ( Id . at p. 400.) In contrast, the number of pot ential plaintiffs to wh om an insurance agent such as Hertel would owe a duty is limited. Specifically, only wh ere an HOA's insurance policy protects the individual interests of th e homeowners in addition to their common or collective interests, would an insurance agent have a duty to meet the standards of his profession with respect to those homeowners. Further, the Bily court was concerned that auditors could be left as the sole parties from whom investors could recover if the c ourt were to impose a duty on them, noting that by the time investors have determined that they have been damaged, "[t]he client, its promoters, and its managers ha ve generally left the scene, headed in mo st cases for government-supervised liquidatio n or the bankruptcy court," such that the "auditor has . . . assumed center stage as the remaining solvent defendan t and is faced with a claim for all sums of money ever loaned to or invested in the client." ( Bily , supra , 3 Cal.4th at p. 400.) Here, there are multiple parties who could be found to bear responsibility for the losses that plaintiffs suffered. In fact, it is possible that a fact finder would conclude that26 Hertel is not solely liable, and that he should be held responsible for only a portion of the damages that plaintiffs seek. Including Hertel as one of multiple parties owing a duty to plaintiffs and allowing for liability for failing to protect would not be out of all proportion to any fault that he may be found to bear. ii. The level of sophistication of the plaintiff in the context of the transaction, including the poten tial for "private ordering" to contractually protect against the risk The Bily court distinguished the class of third party investors, creditors, and others who read and rely on audit reports and fina ncial statements, from ordinary consumers. ( Bily , supra , 3 Cal.4th at p. 403.) The court noted that, unlike th e " 'presumptively powerless consumer' " in product liability cases, more sophisticated investor/creditor plaintiffs have the ability to " 'privately orde r' the risk of inaccurate financial reporting," either through their own investigation or au dit, or by contractual arrangements with the client. ( Ibid .) The Bily court observed, "As a matter of ec onomic and social policy, third parties should be encouraged to rely on th eir own prudence, diligence, and contracting power, as well as other informational tools. This kind of self-re liance promotes sound investment and credit practices and discourage s the careless use of monetary resources. If, instead, third parties are simply permitted to recover from the aud itor for mistakes in the client's financial statements , the auditor becomes, in effect, an insu rer of not only the financial statements, but of bad loan s and investments in general." ( Ibid .) Thus, in a financial transaction that presents a risk of loss, a party contemplating the transaction should be encouraged to take appropriate step s to protect his or her own interests through prudence, diligence and contracting power.27 The individual homeowners who are suing Hertel in the present case are not like the sophisticated investors who br ought suit against an auditor in Bily . The individual homeowners have a special relationship with both the Association representing them, as well as with the insurance ag ent who obtained the "all ri sk" insurance policy for the Association—a policy that spec ifically provided protection for the homeowners' risk of loss to their individual units —and who acted to change that policy in a way that eliminated this protection. The homeowners were in a uniquely vulnerable position with respect to the transactions at issue in this case in that unde r the terms of the Association's CC&Rs, the homeowners justifiabl y relied on the Association and the insurance agent to protect their individual interests. Alth ough the homeowners c ould have purchased additional insurance to provid e back-up coverage for the risk of damage to their individual units, this would have been econo mically inefficient si nce such risks were covered by the Association's "all risk" policy. Procuring additiona l insurance in this circumstance would have been redundan t. Under these circumstances, the Bily consideration of "private or dering" does not counsel agains t imposing a duty on Hertel toward the individual homeowners. iii. The potential adverse impact on the class of defendants on whom the plaintiffs seek to impose a duty The Bily court was particularly concerned that imposing liability on auditors would not only fail to create "a significant a nd desirable improvement in audit care," but would also likely cause "deleter ious economic effects." ( Bily , supra , 3 Cal.4th at p. 404.) The Bily court explained, "In view of the inhere nt dependence of the auditor on the client28 and the labor-intensive nature of auditing, we doubt whether audits can be done in ways that would yield significantly greater accuracy without disadvantages." ( Ibid .) It is unclear whether such a concern makes sense in this case. Rather, it would appear that there could be fairly simple things that an insurance agent could do differently in a situation like the one in this case to en sure greater "accurac y" in changing HOA insurance coverage, with little downside. Sp ecifically, an insuranc e agent could request verification of a change request to an "a ll risk" policy from an HOA's board, or could request to see the minutes of the board actions authorizing such a change. Such efforts would be minimal, would be unlikely to decrease the availa bility of agents willing to assist HOAs in procuring coverage, and would help prevent the kind of unintended lapse in insurance coverage that occu rred here. For these reasons, we conclude that this factor minimally weighs in favor of imposing a le gal duty on Hertel for which the homeowners had to pay a special assessment as a result of the litigation ov er the uninsured loss to the Abramses' unit.

c. Consideration of all the factors le ads to the conclusion that Hertel did not owe the individ ual homeowners a duty with respect to the injury that they are claiming While some of the Biakanja/Bily factors weigh in favor of imposing a duty on Hertel, the most significant of the factor s—specifically, the fo reseeability of the particular harm for which recovery is sought and the closeness of connection between the defendant's conduct and the injury alleged—co unsel against imposing a duty on Hertel in this case. In our view, having concluded that it was not reasonably foreseeable that Hertel's alleged conduct would result in the ki nd of injury suffered by plaintiffs here, and29 that his alleged conduct is not closely conn ected to the injury alleged, it would be unreasonable to impose liability on Hertel for such damages. 6 Hertel's duty to use due care as an insu rance agent does not extend to protecting the individual homeowners from harm beyond harm to their insured interests . The damages for which plaintiffs seek compensa tion in this case—dam ages from a special assessment imposed on them as a result of the settlement of the Abrams litigation—are not within the scope of this duty. Although we disagree w ith the trial court's conclusion that Hertel would never owe any duty at all to the individual homeowners, we nevertheless conclude that under the circumstan ces alleged in this case, the trial court did not err in granting summary adjudication in favor of Hertel on plaintiffs' professional negligence claim.
C. The fraud and negligent misrepr esentation causes of action Plaintiffs contend that the trial court erred in granting summary adjudication in favor of Hertel on their second and thir d causes of action for fraud and negligent misrepresentation. 7 We reject this contention.

6 Although Biakanja and Bily do not suggest that any of the factors are more important than others, in our view, the fo reseeability of the harm at issue and the closeness of the connection between the de fendant's conduct and the harm suffered should be the first factors to be addressed in determining whether a defendant has a duty to use due care toward an interest of another wh o is not in privity with the defendant. If a court were to conclude that the harm suffe red by the plaintiffs was not a reasonably foreseeable consequence of th e defendant's conduct and that the defendant's conduct was not closely connected to the harm suffered, then it would not be reasonable to impose liability on the defendant, rega rdless of whether some or all of the other factors might counsel in favor of imposing liability.30 Both the second and third causes of acti on are based on Hertel's conduct at the August 23, 2003 annual meeti ng, and not on his June 2 003 conduct in initiating the change request. Plaintiffs allege that proper ty manager Brooks invite d Hertel to speak to the Association's membership at the August 2003 meeting. At that meeting, Hertel gave a presentation in which he expounded on the merits of changing the association's insurance policy from "all risk" to "bare walls" coverage. Plaintiffs allege, and Hertel does not dispute, that he did not inform an yone at the meeting that the Association's policy had already been changed to a "bar e walls" policy prior to the meeting, and thereby implied, at a minimum, that the po licy that was in effect at the time of the meeting was an "all risk" policy. One member asked Hertel "if any change in insurance coverage had as yet been effected, and" in re ply, Hertel represented that no change in the policy had been effectuated. 8 The Association membership voted not to change the policy to a "bare walls" policy at that meeting.

7 Neither party took great pains to addre ss the propriety of the trial court's granting of summary adjudication in favor of Hertel on these two causes of action. In fact, plaintiffs originally contended in briefing that a reversal as to their first cause of action would necessarily extend to the second and third causes of action. As will become clear, we disagree with this assessment, and are dismayed that the pa rties devoted so little attention or analysis to th e question whether Hertel was entitled to judgment on these causes of action.
8 The parties dispute what Hertel's and Brooks's motiv es were in not telling the members of the Association at this meeting that the insurance policy had already been changed. Hertel states that "[b]ecause of what Brooks told me [i.e ., that there had been water loss in a unit, the CC&Rs had not been amended to allow for bare walls coverage, and the Association membership was in the process of collecting ballots to amend the CC&Rs to allow for a reduction in coverage], and my confusion as to the import of what31 The elements of fraud, which give rise to the tort action for deceit, are (1) a misrepresentation, (2) with knowl edge of its falsity, (3) with the intent to induce another's reliance on the misrepresentation, (4) justif iable reliance, and (5) resulting damage. ( Small v. Fritz Companies, Inc . (2003) 30 Cal.4th 167, 173 ( Small ).) The tort of negligent misrepresentation, anothe r species of the tort of deceit ( Bily, supra, 3 Cal.4th at p. 407), does not require the inte nt to defraud but only " '[t]he assertion, as a fact, of that which is not true, by one who has no reasonable ground for believing it to be true.' " ( Small , supra , at p. 174.) The elements of neg ligent misrepresentation are "(1) the misrepresentation of a past or existing mate rial fact, (2) without reasonable grounds for believing it to be true, (3) with intent to induce another's reliance on the fact misrepresented, (4) justifiable reliance on the misrepresentation, and (5) resulting damages." ( Apollo Capital Fund LLC v. Roth Capital Partners, LLC (2007) 158 Cal.App.4th 226, 243.) In order to establish fraud or neglig ent misrepresentation, plaintiffs must demonstrate that they were damaged as a re sult of Hertel's misrep resentations. Even assuming that everything that the plaintiffs' assert is true—i.e ., that Hertel misrepresented in August 2003 that no change had been effectuated, and th at plaintiffs and members of the Board remained unaware of the change until months late r, in or around approximately November 2003—plaintiffs have not identified any harm that they suffered as a result of

he told me, I did not tell the unit owners pres ent" about the change request that he had submitted to Truck.32 having been kept in the dark about the change in coverage between August and November. The Abramses' property lo ss occurred in June 2003, after the insurance coverage change had been effectuated but prior to Hertel's misrepresentation at the August 2003 meeting. All of the damages that plaintiffs seek arise out of their having to pay for the settlement of the Abramses' cl aims against the Association resulting from their property loss. Although the ev idence demonstrates that Hertel's statements at the August meeting were false, that he knew they were false, and that he inte nded that plaintiffs rely on the statements and vote to amend the CC&Rs to permit a change in coverage from "all risk" to "bare walls," there is no evidence that pl aintiffs' reliance on th ese statements caused any additional damage to them. 9 In other words, the damage that the plaintiffs ultimately suffered arose as a result of the property loss suffered by the Abramses during a time period when the Association' s insurance coverage had been reduced from "all risk" to "bare walls." The conduct th at caused the property loss to be uninsured and that caused the Abramses to initiate litigation against th e Association was the implementation of a change in the Association' s insurance policy from "all ri sk" to "bare walls," which occurred in June 2003. Hertel's misrepresentations in August 2003 that plaintiffs allege prevented the Board and other members of the Association from learning that the

9 It seems clear from the facts in evidence on summary judgment that Hertel did, in fact, misrepresent the nature of the Associa tion's policy at the August 23, 2003 meeting. We do not intend to suggest th at such conduct was reasonable or condonable. Rather, we simply conclude that there rema in no material issues in di spute with respect to whether Hertel's misrepresentation at that meeti ng caused plaintiffs' identified damages.33 insurance policy had been changed did not lead to plaintiffs' having to pay $8,500 each to
cover the settlement with the Abramses. Further, there is no evidence in the record that suggests that plaintiffs suffered any additional, separate injuries as a result of Hertel's misrepresentations at the August 2003 meeting. Rather, in the operative complaint, plaintiffs assert that if Hertel had not misrepresented at that meeting that no change in coverage from "all risk" to "bare walls" had already occurred, (1) they could have "t ake[n] prophylactic steps [on] their own behalf (such as the obt aining of additional condominium inte rior and contents coverage to protect against the 'gap' created by the reducti on to only 'bare walls' coverage)," and (2) they "would also have been able to interv ene informally with [t he insurance company 10 ], or if necessary, later file a complaint in inte rvention in the Abrams litigation, all in an effort to secure reversion to 'All-Risk' coverage from the unauthorized 'bare walls' coverage." Plaintiffs contended that if they had been able to do either of these things, they could have avoided the $8,500 special assessment. As evidence supporting their contention that Hertel's misrepresentations at the August 2003 meeting caused damage to them, plaintiffs refer to the declaration of Russell Russo, a Las Brisas homeowner and one of the plaintiffs. Russo, who was present at the August 2003 meeting, states, "Had I not been of this belief that th e full, 'all risk' coverage rema ined in effect—a belief based

10 In their pleadings and other documents, plaintiffs refer to the insurance company as "Farmers." From the record it appears that Farmers a nd Truck are related entities, but the parties do not discuss the relationship betw een the two, and no one has raised this as an issue. In their briefing in response to Hertel's motion for summary judgment, plaintiffs do not dispute the fact that at the relevant time period , the Association was insured under a Truck insurance policy.34 primarily upon Hertel's representation, whic h I now know to have been false—I would certainly have insisted that the Las Bris as HOA Board commence litigation against [the insurer] at once, by an acti on for declaratory or other relie f, to judicially compel [the insurer] to immediately effect reinstatement of the 'all risk' coverage. I knew that such a court action would be successf ul, probably by su mmary judgment, because the alleged change to 'bare walls' had been utterly and complete ly lacking in any proper authorization, either by 'Board action' or by the required CC&R amendment . . . ." We find these assertions of injury meritle ss. First, no injury can be traced to the homeowners' inability to obtain individua l insurance for thei r condominium units after the August 2003 meeting at which Hertel misr epresented the Association's coverage. As noted, the only property damage to which pl aintiffs have pointed that resulted in the Association members having to pay a special assessment is the uninsured property damage suffered by the Abramses. The chan ge in the policy from "all risk" to "bare walls," and the Abramses' subseque nt property loss, both occurred prior to the August 2003 meeting. The plaintiffs thus have not demonstrated, and cannot demonstrate, that their damages resulted from not having had th e opportunity to obtai n property insurance to cover their individual risk due to misrepre sentations made by Hertel in August 2003. Second, although the plaintiffs assert th at they would have intervened in the Abrams litigation or w ould have filed suit against Truc k directly, there is no evidence that they did either of thes e things even after members of the Board and/or Association became aware in November 2003 that the Association's policy had been changed to "bare walls." In a letter dated November 10, 2003, an attorney for the Abramses advised the35 Association that its policy had been change d from "all risk" to "b are walls," effective April 3, 2003, and that the Abramses planned to seek compensation fro m the Association. Plaintiffs do not dispute the contents of this letter, or that it was received by members of the Association, including one of the named plaintiffs, Robert Keilholtz, who in his deposition admitted to knowing about the change in coverage when he learned of the Abramses' plan to seek compensation from the Association. Keilholtz also admitted that "the first time we were made aware, me personally and most of the board members and most of the HOA members, was at the time th at [the Abramses] had a loss and that we found out that we probably wouldn't have co verage," which occurred during Keilholtz's 2003-2004 service as a Board member. Despite learning of the change in the policy from "all risk" to "bare walls" in or around Novemb er 2003, at no point in time did any of the plaintiffs file a lawsuit agai nst Truck or attempt to interv ene in the Abrams litigation. There is nothing to suggest that plaintiffs were prevented from doing these things as a result of being unaware of the true nature of the Association's insurance coverage between August 2003 and Nove mber 2003. They have not asserted that any cause of action that they may have possessed became ti me-barred as a result of the delay in their learning about the coverage change, that any defense they may have had to the Abramses' claims was lost during the fe w months' time when they re mained unaware that their insurance coverage had been re duced, or that their ability to properly litigate or defend such claims was hindered as a result of any loss of evidence caused by the delay in their knowing about the change in coverage.36 Finally, with respect to pl aintiffs' allegation that they suffered damages in the amount of $8,500 per unit for a ttorney fees paid in settleme nt of the Abramses' claims because Hertel's misrepresent ations at the August 2003 meeting prevented them from intervening "informally" with Truck before Truck assume d its defensive position with respect to the Abramses ' loss, this contention is entirely speculative. Even if plaintiffs could prove that they would ha ve attempted to intervene "i nformally" with the insurance company to attempt to get it to agree to cover a loss suffered at a time when the effective policy did not provide coverage , they could not establish th at anything they might have done would in fact have resulted in Truck agreeing to cover the Abramses' individual property damage, thereby elimin ating the need for the Abrams es to file suit against the Association and the Associati on's subsequent need to settle the Abramses' claims. There is simply no allegation of any inju ry suffered by plain tiffs as a result of Hertel's misrepresentations as to the nature of the Association's insurance coverage at the August 2003 meeting, and plaintiffs cannot demonstrate that Hertel's conduct at that meeting caused the damages they have alleged th ey suffered. We therefore conclude that summary adjudication in favor of Hertel on pl aintiffs' second and third causes of action was proper. Hertel is entitled to judgment as a matter of law on th ese causes of action because the plaintiffs cannot establish that his misrepresentations at the August 2003 meeting caused them damage.37 IV. DISPOSITION The judgment of the trial court is affirm ed. Hertel is entitled to costs on appeal.

AARON, J.
WE CONCUR:

HUFFMAN, Acting P. J.

HALLER, J.