Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_04-cv-00836/USCOURTS-caed-2_04-cv-00836-9/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1332 Diversity-Breach of Contract

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28 * This motion was determined to be suitable for decision without

oral argument. L.R. 78-230(h). 

1

IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF CALIFORNIA

FIRST NATIONAL INSURANCE COMPANY )

OF AMERICA, a Washington ) 02:04-cv-836-GEB-JFM

corporation, )

)

Plaintiff, ) 

) ORDER*

v. ) 

)

MBA CONSTRUCTION, a California )

corporation doing business as MACK )

CONSTRUCTION; KEVIN D. MACK, an )

individual; KATIE BAUGH, an )

individual; and DANNY W. BAUGH, )

an individual, )

)

Defendants. )

)

Plaintiff seeks $138,449.68 in attorney fees and related

expenses, $709.62 in travel expenses, and $14,291.59 in prejudgment

interest. (McGowan Supp. Decl. ¶¶ 2-3.) Defendants oppose the

motion. 

BACKGROUND

Plaintiff and Defendants entered into a General Agreement

for Indemnity (“Indemnity Agreement”) whereby Plaintiff agreed to

issue a payment bond guaranteeing the obligations of Defendant Mack

Construction for a construction project for the Redding School

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District. (Hyslop Decl. ¶¶ 5,9.) In return, Defendants agreed to

indemnify Plaintiff for any loss, cost or expense incurred in

connection with the payment bond. (Id. ¶ 5, Ex. A.) When several

subcontractors on the project submitted claims against the payment

bond, Plaintiff paid these subcontractors. (Id. ¶¶ 14-21) Plaintiff

requested Defendants reimburse and collateralize Plaintiff for these

payments, but Defendants did not reimburse Plaintiff for the claims of

two subcontractors, Partition Specialty and Tina’s Interior Design

Resource. (Id. ¶¶ 15-27.) Plaintiff subsequently filed this action,

seeking $77,728.00 for its payment to Partition Specialty and

$25,237.36 for its payment to Tina’s Interior Design Resource, as well

as attorney fees, expenses, and prejudgment interest. (Pl.’s Mem. of

P. & A. in Support of Postjudgment Mot. for Att’y Fees, Expenses and

Prejudgment Interest (“Pl.’s Mem.”) at 1.) 

In April 2005, Plaintiff filed a Motion for Partial Summary

Judgment seeking specific performance of the collateral security

provisions of the Indemnity Agreement. An Order filed July 22, 2005,

held that Plaintiff was not entitled to collateralization for the

payment to Tina’s Interior Design Resource because a genuine issue of

material fact existed as to whether Plaintiff’s “alleged interference

. . . at least in part caused Plaintiff” to pay the claim. (Order,

July 22, 2005, (“July Order”) at 5.) However, the July Order held

that Plaintiff was entitled to collateralization for the payment to

Partition Speciality. Id. An Order filed August 11, 2005, required

Defendants to collateralize Plaintiff in the amount of $77,728.00

within twenty (20) days of the date of the Order. (Order, August 11,

2005, (“August Order”) at 1.) 

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1 Plaintiff asserts “state law governs” and bases its Motion for

Attorney Fees and Prejudgment Interest on California law. (Pl.’s Mem.

at 8-9.) Defendants do not explicitly assert that state law governs,

but base their Opposition on California law. (See Defs.’ Mem. of P. &

A. in Opp’n (“Defs.’ Opp’n”) at 5, 11-14, 17-18.) 

3

On September 8, 2005, pursuant to a stipulation by the

parties, judgment was entered against Defendants jointly and severally

“in the amount of $ 102,966.00, exclusive of any recoverable interest,

costs or attorney fees.” (Stipulation and J. at 3.) The judgment

satisfied the August Order that Defendants collateralize Plaintiff in

the amount of $77,728.00. (Id. at 4.) However, the judgment neither

waived “Plaintiff’s claim for interest, costs, and attorneys’ fees,

nor any of Defendants’ defenses to said claims.” (Id. at 3.) The

judgment allowed Plaintiff to submit a claim for interest, costs and

attorney fees pursuant to Local Rules 52-292 and 52-293, and stated

the “Court shall rule on Plaintiff’s claims for interest, costs and/or

attorneys’ fees pursuant to the applicable law, and issue an

additional judgment if, and to the extent, the Court finds interest,

costs, and/or attorney fees are recoverable.” (Id.) 

DISCUSSION

Jurisdiction over this case is premised on diversity of

citizenship of the parties. (Pl.’s Complaint ¶ 1.) In diversity

actions, state law governs an award of attorney fees, expenses and

prejudgment interest. In re Baroff, 105 F.3d 439, 442 (9th Cir.

1997); Northrop Corp. v. Triad Int’l Mkt. S.A., 842 F.2d 1154, 1155

(9th Cir. 1988). The parties do not dispute that California law

applies.1 Therefore, California law governs whether Plaintiff recovers

attorney fees, expenses and prejudgment interest. 

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2 Defendants do not appear to dispute that the Indemnity

Agreement authorizes an award of attorney fees because they acknowledge

that the “Indemnity Agreement calls for reasonable attorney fees.”

(Defs.’ Opp’n at 6.) 

4

I. Attorney Fees

California Code of Civil Procedure § 1021 provides that

“[e]xcept as attorney’s fees are specifically provided for by statute,

the measure and mode of compensation of attorneys and counselors at

law is left to the agreement, express or implied, of the parties; but

parties to actions or proceedings are entitled to their costs, as

hereinafter provided.” (West Supp. 2005). Pursuant to California

Code of Civil Procedure §§ 1032 and 1033.5, the prevailing party may

recover attorney fees as costs when authorized by contract. Scott Co.

of Cal. v. Blount Inc., 20 Cal. 4th 1103, 1008-09 (1999). In

addition, California Civil Code § 1717(a) states that “[i]n any action

on a contract, where the contract specifically provides that

attorney’s fees and costs, which are incurred to enforce that

contract, shall be awarded . . . then the party who is determined to

be the prevailing party on the contract . . . shall be entitled to

reasonable attorney fees in addition to other costs.” (West 1998). 

Therefore, in order for Plaintiff to recover the attorney fees it

seeks, (1) the contract must authorize such fees, (2) Plaintiff must

be the prevailing party, and (3) the fees incurred must be reasonable.

A. Indemnity Agreement

Plaintiff argues that the Indemnity Agreement authorizes an

award of attorney fees and related expenses.2 (Pl.’s Mem. at 8.) 

Pursuant to the Indemnity Agreement, Defendants agreed to pay

Plaintiff upon demand “[a]ll loss, costs and expenses of whatsoever

kind and nature, including court costs, reasonable attorney fees . . .

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and any other losses, costs or expenses incurred by Surety by reason

of having executed any Bond, or incurred by it on account of any

Default under this agreement . . . .” (Hyslop Decl. Ex. A.) 

According to the Indemnity Agreement, “Default” occurs if a Defendant

“[b]reaches, fails to perform, or comply with any provision of this

agreement.” (Id.) Consequently, because Defendants “fail[ed] to

provide the required indemnity and reimbursement owed to Plaintiff,”

the Indemnity Agreement authorizes an award of attorney fees and

related expenses to Plaintiff. (July Order at 3.) 

B. Prevailing Party

Plaintiff argues it is the prevailing party because “the

Stipulation and Judgment clearly provides that Judgment will be

entered in favor of Plaintiff in the amount of $102,966.00.” (Pl.’s

Mem. at 9.) Plaintiff asserts “Defendants take nothing under the

Stipulation and Judgment and make no claim for affirmative relief

. . . that could decrease the judgment.” (Id.) Defendants argue they

are the prevailing party, or alternatively, that no party prevailed

because the “results of the litigation are mixed, i.e. the opposing

litigants . . . [can] each legitimately claim some sucess in the

litigation.” (Defs.’ Opp’n at 17.) 

“When a party obtains a simple, unqualified victory by

completely prevailing on or defeating all contract claims in the

action and the contract contains a provision for attorney fees,

section 1717 entitles the successful party to recover reasonable

attorney fees incurred in prosecution or defense of those claims.” 

Scott Co. of Cal., 20 Cal. 4th at 1109. However, if neither party

achieves a “complete victory on all the contract claims,” the trial

court has discretion “to determine which party prevailed on the

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3 Defendants assert Plaintiff is barred from recovery under the

equitable doctrine of unclean hands because (1) Plaintiff interfered

with Defendants’ ability to receive payments from the Redding School

District, (2) Plaintiff paid Tina’s Interior Design and Partition

Specialty prematurely, (3) Plaintiff breached the Indemnity Agreement,

not Defendants, (4) Plaintiff refused Defendants’ request to stay this

action, and (5) Plaintiff “reneged” on a settlement deal to resolve all

outstanding claims on the project. (Defs.’ Opp’n at 3-4.) 

6

contract or whether, on balance, neither party prevailed sufficiently

to justify an award of attorney fees.” Id. To determine whether a

party prevailed, “the trial court is to compare the relief awarded on

the contract claim or claims with the parties’ demands on those same

claims and their litigation objectives as disclosed by the pleadings,

trial briefs, opening statements, and similar sources.” Id.

Defendants admit that the judgment against Defendants in the

amount of $102,966, “was equivalent to the Bond claims of Partition

Speciality, Inc. for $77,728.00 and Tina’s Interior Design Resource

for $25,237.00 plus 64 cents.” (Defs.’ Opp’n at 6.) Consequently,

through the judgment Plaintiff acquired precisely the relief it

sought: reimbursement for Plaintiff’s payments to these two

subcontractors. Therefore, the results of Plaintiff’s “contract

claims are not mixed” as Defendants argue because the resolution of

the “contract claims is purely good news for one party and bad news

for the other.” Hsu v. Abbara, 9 Cal. 4th 863, 875-76 (1995). 

Defendants also argue Plaintiff should not be considered the

prevailing party under the equitable doctrine of unclean hands.3

(Defs.’ Opp’n at 13.) Although “courts should be guided by equitable

considerations,” when one party obtains an “unqualified win” the other

party “may not invoke equitable considerations unrelated to litigation

success.” Hsu, 9 Cal. 4th at 877. Otherwise, consideration of

equitable principals “would convert the attorney fees motion from a

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4 Plaintiff states that the amount of attorney fees and related

expenses were calculated by taking the total amount of fees and expenses

incurred through October 31, 2005, and deducting $3,797.44, which was

submitted separately in a Bill of Costs filed September 21, 2005.

(McGowan Supp. Decl. at 2, n. 1.) 

7

relatively uncomplicated evaluation of the parties’ comparative

litigation success into a formless, limitless attack on the ethics and

character of every party who seeks attorney fees.” Id. at 877. 

Consequently, when the “results of the litigation on the contract

claims are not mixed . . . a trial court has no discretion to deny

attorney fees to the successful litigant.” Id. at 876-77. Since

Plaintiff has achieved an “unqualified victory,” Defendants’ argument

that Plaintiff should be denied attorney fees on account of equitable

considerations unrelated to litigation sucess is unavailing. Id.

Therefore, Plaintiff is the prevailing party and may recover

reasonable attorney fees. 

C. Reasonable Fees

Plaintiff argues that the $138,449.68 in attorney fees and

related expenses and the $709.62 in travel expenses Plaintiff incurred

to enforce the Indemnity Agreement are reasonable.4 (Pl.’s Mem. at 10;

McGowan Supp. Decl. ¶ 3.) Defendant contends “the attorney fees are

unquestionably unreasonable” and “travel expenses are not recoverable”

in a motion for attorney fees. (Defs.’ Opp’n at 9,17.) “[G]eneral

rules [have been developed] to guide the exercise of . . . [the

court’s determination of] a reasonable fee.” People ex rel. Dept. of

Transp. v. Yuki, 31 Cal. App. 4th 1754, 1767 (1995). “The starting

point in determining a reasonable fee is a calculation of the

attorney’s services in terms of the time he or she has expended on the

case.” Id.; PLCM Group v. Drexler, 22 Cal. 4th 1084, 1095 (2000)

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5 The court may consider (1) the novelty and difficulty of the

questions involved and the skill required to perform the legal services

properly, (2) the likelihood that the acceptance of this particular

employment would preclude other employment by the attorneys, (3) the

amount involved and the results obtained, (4) the time limitations

imposed by the client or by the circumstances of the case, (5) the

nature and length of the professional relationship with the client, (6)

the experience, reputation, and ability of the attorneys who performed

the services, (7) whether the fee is fixed or contingent, (8) the time

and labor required of the attorneys, and (9) the informed consent of the

client to the fee agreement. Glendora Cmty. Redevelopment Agency v.

Demeter, 155 Cal. App. 3d 465, 474 (1984); PCLM Group, 22 Cal. 4th at

1096. 

8

(“California courts have consistently held that a computation of time

spent on a case and the reasonable value of that time is fundamental

to a determination of an appropriate attorneys’ fee award.”). 

However, the amount of the award can be adjusted “based on

consideration of factors specific to the case, in order to fix the fee

at the fair market value for the legal services provided.”5 PCLM

Group, 22 Cal. 4th at 1095. 

Defendants argue Plaintiff’s attorney fees and expenses are

unreasonable because the case was “relatively simply and [did] not

require special skills.” (Defs.’ Opp’n at 10.) In addition,

Defendants contend Plaintiff “did nothing more than prepare (1) a

boilerplate Motion to Dismiss [Defendants’ First Amended Counterclaim]

. . .; (2) a Motion for Partial Summary Judgment . . .; and (3) oppose

[Defendants’] Motion to Stay Proceedings During the Pendency of the

State Court Action.” (Defs.’ Opp’n at 8.) Plaintiff responds that

the attorney fees and expenses are reasonable because of “the

aggressive pleadings and motions filed by Defendants . . . and the

fact that the Stipulation and Judgment was reached on a date so close

to the scheduled trial date.” (Pl.’s Reply at 20.) In addition,

Plaintiff argues the Motion to Dismiss was “hardly boilerplate,” and

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the “Motion for Partial Summary Judgment was . . . laborious, due to

the extensive evidentiary objections and other arguments . . . by

Defendants in Opposition.” (Id.) Plaintiff also asserts that “these

motions [were] not the only tasks performed by Plaintiff during the

sixteen months that the parties litigated this matter.” Plaintiff

contends that “[a]mong other legal work, Defendants ignore the trial

preparation, the preparation and taking of a deposition, the attempts

to obtain written discovery from Defendant [sic], the attempts to

enter a collateral agreement, and necessary joint statements and other

tasks required of any party in litigation.” (Id. 20-21.) 

A review of all the documents filed in this action and the

declarations and exhibits submitted by Plaintiff detailing the hours

worked by counsel on each particular matter, reveals that a

considerable amount of time and effort was required of Plaintiff’s

counsel to successfully litigate this action. Although Plaintiff’s

counsel spent significant time filing a Motion to Dismiss, a Motion

for Partial Summary Judgment, and a Motion in Opposition to

Defendants’ Motion to Stay Proceedings, all of these motions were

decided in whole or in part in favor of Plaintiff. In addition, most

of the other tasks performed by Plaintiff’s counsel, such as

requesting written discovery, preparing for and conducting a

deposition, and engaging in negotiations with Defendants regarding

settlement, appear to have contributed to the eventual resolution of

this litigation. Finally, although Plaintiff’s counsel spent

considerable time in August 2004 and September 2004 preparing for

trial, that amount of time appears reasonable because judgment was

entered against Defendants only a few weeks prior to the trial date of

September 27, 2005. Therefore, Plaintiff is awarded the attorney fees

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6 At the time Defendants filed their Opposition, Defendants

argued that Plaintiff counsel’s estimate of “$14,980.00 (to prepare the

motion for attorney fees) . . . is not reasonable.” (Defs.’ Opp’n

at 6.) However, after Defendants filed their Opposition, Plaintiff

incurred additional attorney fees due to the preparation of the Reply

brief. (McGowan Supp. Decl. ¶ 2.) According to the invoice submitted

by Plaintiff, the final amount of attorney fees and expenses incurred

for both the Motion and Reply total $26,008.63. (Id. Ex. A.) 

10

associated with these hours because the majority of the time billed by

Plaintiff’s counsel was reasonable. 

Defendants also object to the time billed by Plaintiff’s

counsel on certain tasks. First, Defendants argue that the time

Plaintiff’s counsel spent preparing the Motion for Attorney Fees is

not reasonable.6 (Defs.’ Opp’n at 6.) Plaintiff responds that these

fees are reasonable because the motion “includes a mix of legal

argument and factual presentation that required the significant

attorney time documented” due to “the vast array of substantive and

procedural argument raised by Defendants in their Opposition.” (Pl.’s

Reply at 21.) Although Plaintiff’s counsel expended considerable time

preparing the Motion for Attorney Fees and the Reply, these hours

appear reasonable in light of the time necessary to file the briefs,

to prepare the supporting declarations, to explain month-by-month what

fees were incurred and why, and to compile all the invoices, billing

statements, and other supporting documents. Therefore, Plaintiff is

awarded the fees associated with these hours.

Second, Defendants contend Plaintiff should not recover the

attorney fees Plaintiff incurred while defending actions in state

court by other payment bond claimants and the California State

Department of Labor Standards Enforcement. (Defs.’ Opp’n at 18.) 

Plaintiff argues that the Indemnity Agreement allows Plaintiff to

recover attorney fees incurred “in defending against claims against

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the bonds Plaintiff issues on behalf of Defendant Mack Construction.” 

(Pl.’s Mem. at 12.) Plaintiff contends that the attorney fees

incurred defending the state court actions are recoverable because

they “were incurred as a result of issuing the [b]onds” pursuant to

its obligations under the Indemnity Agreement. (Id. at 12.) 

Although the attorney fees were incurred in connection with

separate state court cases, these fees are closely related to this

action because they were incurred by Plaintiff while defending the

same payment bond that is the subject of this litigation. “[A] trial

court may, in its discretion, determine that time reasonably expended

on an action includes time spent on other separate but closely related

court proceedings.” Wallace v. Consumers Cooperative of Berkeley,

Inc., 170 Cal. App. 3d 836, 849 (1985); Children’s Hosp. and Medical

Center v. Bonta, 97 Cal. App. 4th 740, 779 (2002) (“California case

law clearly provides a trial court discretion to award a fee that

compensates work performed in a collateral action that may not have

been absolutely necessary to the action in which fees are awarded”). 

Therefore, Plaintiff is awarded the attorney fees associated with the

state court actions.

Third, Defendants argue that Plaintiff should not recover

the legal fees of Bennett Lee prior to his admission to the California

State Bar. (Defs.’ Opp’n at 9.) In its Reply, Plaintiff withdrew its

claim for the fees billed by Bennett Lee prior to his admission to the

State Bar on May 24, 2004. (Pl.’s Reply at 21-22.) Therefore, the

attorney fees sought by Plaintiff are reduced by $5,704.00, the amount

billed for the services of Bennett Lee from March 8, 2004, through May

23, 2004. (Lee Reply Decl. ¶ 10.) 

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Fourth, Defendants contend Plaintiff should not recover

$709.62 in travel expenses. (Defs.’ Opp’n ¶ 17.) Plaintiff argues it

should recover these travel expenses because they were incurred by

Nicholas Hyslop while visiting the offices of Defendant Mack

Construction. (Pl.’s Reply at 18.) However, the declaration of

Nicholas Hyslop does not discuss who incurred the expenses, how these

expenses were incurred, or when the expenses were incurred, and the

exhibits attached to the declaration do not document these expenses. 

Rather, the declaration merely includes a chart with an entry for

“travel” and the amount of “709.62." (Hyslop Decl. ¶ 19.) Without

any discussion of or documentation for these expenses, it cannot be

said that the expenses incurred were reasonable. Accordingly,

Plaintiff cannot recover $709.62 in travel expenses. 

In addition, some of the time spent on this litigation by

Plaintiff’s counsel does not appear reasonable. On April 27, 2005,

Plaintiff filed a Motion for Reconsideration, requesting that the

Court revisit an Order filed April 27, 2005, which continued the

hearing on Plaintiff’s Motion for Partial Summary Judgment. An Order

filed April 29, 2005, denied Plaintiff’s Motion for Reconsideration.

(Order, April 29, 2005, at 2.) The Order noted Plaintiff could have

opposed Defendants’ request for a continuance during “the prescribed

time for filling a reply brief,” but “Plaintiff did not respond to

that request.” (Id.) In addition, the Order observed Plaintiff “did

not explain why it could not have opposed the continuance request in a

timely filed reply brief.” (Id.) Instead, Plaintiff devoted “nearly

two-thirds of Plaintiff’s fourteen page motion” to arguments that

“should have been set forth in a . . . reply brief.” (Id. at 2,

n. 3.) On May 3, 2005, Plaintiff filed a letter dated April 29, 2005,

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7 This amount was calculated as follows: $161.00 was deducted

because Bennett Lee billed .70 hour at $230.00 per hour for tasks

associated with the Motion for Reconsideration. (Lee Decl., Ex. A.) 

Specifically, on April 12, 2005, Bennett Lee billed .60 hour to respond

to Defendants’ request for a continuance, and on April 14, 2005, he

billed .10 hour to define a plan of action in response to the request

for a continuance. (Id.) In addition, $432.00 was deducted because

Kirsten Roe billed 2.4 hours at $180.00 per hour for tasks associated

with the Motion for Reconsideration. (Id.) Specifically, on April 14,

2005, Kirsten Roe billed .40 hour to prepare correspondence relating to

the hearing date, on April 15, 2005, she billed 1.5 hours to prepare a

stipulation to move the hearing date, and on April 20, 2005, she billed

.50 hour to strategize about the preparation of a reply. (Id.)

13

stating that the “untimeliness of Plaintiff’s Reply and objection is

due to the fault of counsel . . . for failure to properly calendar the

deadline for the Reply.” (Letter from Kirsten Roe, Watt, Tieder,

Hoffar & Fitzgerald, L.L.P, to the Honorable Garland E. Burrell, Jr.,

(April 29, 2005) at 1.) Therefore, the attorney fees sought by

Plaintiff are reduced by $593.00 because the time spent on these

filings was due to the fault of Plaintiff’s counsel.7 

Finally, a review of the invoices and billing statements

submitted by Plaintiff reveals that Plaintiff miscalculated the total

amount of attorney fees and expenses incurred during this litigation. 

Plaintiff seeks $138,449.68 in attorney fees and related expenses

incurred from March 8, 2004, through October 31, 2005. (McGowan Supp.

Decl. ¶ 3.) Plaintiff appears to have calculated this amount by

adding $99,997.10, the amount of attorney fees and expenses it

incurred through September 30, 2005, and $38,452.58, the total amount

billed by its counsel on the November 6, 2005, invoice. (Lee Decl.

¶ 3; McGowan Supp. Decl. Ex. A.) The total amount on the invoice

includes $26,008.63 for fees and expenses incurred in October 2005,

and a previous balance of $12,443.95 for work performed in September

2005. (McGowan Supp. Decl. Ex. A.) However, the previous balance for

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work performed in September 2005 is already included in the $99,997.10

for attorney fees and expenses incurred through September 30, 2005. 

(Lee Ex. A.) Therefore, the attorney fees and expenses sought by

Plaintiff are reduced by $12,443.95 in order to accurately reflect the

total amount of fees Plaintiff incurred during this litigation. 

Consequently, the $138,449.68 in attorney fees and expenses

sought by Plaintiff are reduced (1) by $5,704.00 for the services

performed by Bennett Lee prior to his admission to the California

State Bar (2) by $593.00 for time not reasonably expended due to the

fault of counsel, and (3) by $12,443.95 to accurately reflect the

amounts billed. In addition, Plaintiff cannot recover $709.62 in

travel expenses because Plaintiff did not demonstrate that these

expenses were reasonable. Therefore, Plaintiff shall recover a total

of $119,708.73 for attorney fees and expenses. 

II. Prejudgment Interest

Plaintiff requests $14,291.59 in prejudgment interest, “on

the grounds that the damages awarded to Plaintiff were sum-certain

payments which, under California law, entitled a judgment creditor to

prejudgment interest.” (Pl.’s Mem. at 13.) Defendant does not raise

any arguments in response to this request. “[A] plaintiff is entitled

to recover [prejudgment] interest where damages resulting from a

breach of contract ‘are capable of being made certain by

calculation.’” Camrosa County Water Dist. v. Southwest Welding & Mfg.

Co., 49 Cal. App. 3d 951, 958 (1975) (quoting California Civil Code §

3287). Plaintiff paid Tina’s Interior Design Resources $77,728.00 and

Partition Speciality $25,237.36 “only after a due investigation by

First National of the claim, and, notably, after Mack Construction

already expressly admitted that payment in that sum or approximate sum

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8 The amount of prejudgment interest was calculated as follows:

Plaintiff paid Partition Specialty on April 12, 2004. (McGowan Decl.

Ex. A.) Thus, 514 days elapsed between the date of payment and

September 8, 2005, the date Judgment was entered. (Id.) Applying a

daily interest rate of 10% per year equals $10,948.20 in prejudgment

interest for the payment to Partition Speciality. (Id.) Plaintiff paid

Tina’s Interior Design Resources on August 31, 2004. (Id.) Thus, 373

days elapsed between the date of payment and the date Judgment was

entered. (Id.) Applying a daily interest rate of 10% year equals

$2,577.43 in prejudgement interest for the payment to Tina’s Interior

Design Resource. 

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was due to the respective claimant.” (Hyslop Decl. ¶¶ 21-25.) 

Plaintiff paid Partition Speciality on April 12, 2004, and Tina’s

Interior Design Resource on August 31, 2004. (McGowan Decl. Ex. A.) 

After each payment was made, Plaintiff requested Defendants to

reimburse it for the amounts Defendants admitted were owing. (Hyslop

Decl. ¶ 15.) Therefore, at the time the payments were made, the

damages were “certain, or capable of being made certain by

calculation.” California Civil Code § 3287(a) (West 1997). 

According to the Indemnity Agreement, Defendants agreed to

pay Plaintiff “interest on all disbursements made by Surety in

connection with such loss, costs and expenses incurred by Surety at the

maximum rate permitted by law calculated from the date of each

disbursement.” (Hyslop Decl. Ex. A.) When a contract does not provide

a legal rate of interest, California Civil Code § 3289 dictates that

“the obligation shall bear interest at a rate of 10 percent per annum

after a breach.” (West 1997). Applying a 10 percent interest rate to

Plaintiff’s payments to Partition Speciality and Tina’s Interior Design

Resource equals $13,525.63 in prejudgment interest.8 (McGowan Decl.

¶ 2, Ex. A.) Therefore, Plaintiff is awarded $13,525.63 in prejudgment

interest for the payments to these two subcontractors. 

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In addition, it appears Plaintiff seeks prejudgment interest

for payments made to its counsel for attorney fees. (McGowan Decl. Ex.

A.) However, Plaintiff has not adequately identified or properly

documented these payments. Plaintiff only provides a chart identifying

the payment dates, the payee as “WTHF,” and the amounts paid. (McGowan

Decl. Ex. A.) However, it is unclear what the amounts on the chart

represent because they do not correspond to the amounts charged by

Plaintiff’s counsel for attorney fees. (Compare id., with Lee Decl.

Ex. A.) Therefore this request is denied. 

CONCLUSION

For the stated reasons, Plaintiff is awarded to $119,708.73

for attorney fees and related expenses and $13,525.63 for prejudgment

interest. 

IT IS SO ORDERED. 

DATED: December 12, 2005

/s/ Garland E. Burrell, Jr. 

GARLAND E. BURRELL, JR.

United States District Judge 

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