Filed 9/3/24

CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FOURTH APPELLATE DISTRICT

DIVISION THREE

AMERICAN BUILDING 

INNOVATION LP,

 Plaintiff and Appellant,

v.

BALFOUR BEATTY 

CONSTRUCTION, LLC, et al.,

 Defendants and Respondents.

 G062471, G062965

 (Super. Ct. No. 30-2019-01072989)

 O P I N I O N

Appeals from a judgment and postjudgment order of the Superior 

Court of Orange County, Nathan R. Scott, Judge. Affirmed.

Roxborough, Pomerance, Nye & Adreani, Drew E. Pomerance, 

Joseph C. Gjonola, and David R. Ginsburg for Plaintiff and Appellant.

Finch, Thornton & Baird, Jason R. Thornton, Daniel P. Scholz, 

and Scott M. Bennett for Defendants and Respondents.

* * *
2

As a condition precedent to the issuance, continued maintenance, 

or reinstatement of a contractor’s license, California law requires applicants 

and licensees to have on file “at all times” a current and valid certificate of 

workers’ compensation insurance. If the applicant or licensee has no 

employees or is not otherwise subject to workers’ compensation laws, this 

requirement is inapplicable. (Bus. & Prof. Code,1§ 7125, subd. (a) & (b).)

Failure to obtain or maintain the required coverage results in the 

automatic and immediate suspension of the contractor’s license by operation 

of law. (§ 7125.2, subd. (a).) Such a suspension impacts the contractor’s 

ability to litigate claims for compensation: a party who was not “duly 

licensed . . . at all times during the performance of” its contracting work 

generally cannot bring or maintain an action to collect compensation for that 

work. (§ 7031, subd. (a); cf. id., subd. (e) [substantial compliance exception].)

A suspended contractor’s license can be retroactively reinstated if 

the licensee obtains and submits to the registrar a valid certificate of 

workers’ compensation insurance within 90 days of the certificate’s effective 

date. (See §§ 7125.2, subd. (c), 7125.1, subd. (a).) If the certificate is 

submitted to the registrar more than 90 days after its effective date, however, 

retroactive reinstatement is available only if the licensee shows “that the 

failure to have a certificate on file was due to circumstances beyond the 

control of the licensee.” (Id., subd. (b).)

This appeal involves the interplay of these statutes and what 

circumstances are “beyond the control of the licensee” for purposes of 

retroactive license reinstatement. In this case, plaintiff American Building 

Innovation LP (ABI) had a workers’ compensation policy when it started 

1 All further undesignated statutory references are to this code.
3

work on a project. Its insurer canceled the policy, however, because ABI 

refused to pay outstanding insurance premiums charged on a prior policy, 

since ABI believed (correctly as it turns out) it was being overcharged. As a 

result of the policy cancellation, ABI’s contractor’s license was suspended 

mid-project. Fully aware it was unlicensed and uninsured, ABI nevertheless 

continued its work.

ABI later sued to recover amounts allegedly owed for its work on 

the project. Several years into that litigation, ABI settled its old premium 

dispute with its workers’ compensation insurer and had the canceled policy

retroactively reinstated as part of the settlement. ABI then applied to the 

Contractors’ State License Board (the Board) for retroactive reinstatement of 

its contractor’s license, asserting that ABI’s failure to file a certificate of 

workers’ compensation coverage had been “due to circumstances beyond [its] 

control,” in that the policy had been canceled “unbeknownst to” ABI. The 

Board accepted ABI’s representation and retroactively reinstated its 

contractor’s license under section 7125.1.

We must now decide whether ABI was “duly licensed . . . at all 

times during the performance of” its work; if not, section 7031 bars ABI from 

bringing or maintaining the present action. We conclude section 7031 does 

indeed bar ABI’s current claims. A suspended contractor’s license can be 

retroactively reinstated under section 7125.1 only if “the failure to have a 

certificate on file was due to circumstances beyond the control of the 

licensee.” (Id., subd. (b).) In this case, the lapse in coverage was not beyond 

ABI’s control. The record before us demonstrates the policy cancellation 

occurred because ABI chose not to pay billed insurance premiums. ABI

learned of the policy cancellation days after it took effect, yet ABI did not 

procure replacement coverage until years later when it settled the premium 
4

dispute with its insurer. The insurer’s retroactive reinstatement of the policy 

following that settlement was essentially meaningless because it occurred 

long after the statute of limitations ran on any workers’ compensation claims, 

rendering the coverage illusory.

We agree with the trial court that section 7031 bars the present 

action, and we therefore affirm the judgment. We also affirm the award of 

attorney fees under the subcontract’s prevailing party attorney fee provision.

STATEMENT OF FACTS

Defendant Balfour Beatty Construction, LLC (Balfour Beatty) 

was hired by a local school district to construct a two-story classroom building 

at an elementary school. In June 2017, Balfour Beatty hired ABI as a 

subcontractor to perform concrete, framing, and structural steel work on the 

project and agreed to pay ABI over $700,000 for its work. 

ABI was on the project from August 2017 through May 2018. ABI 

concedes that its work on the project required it to be licensed by the Board 

and that it had to maintain workers’ compensation insurance throughout the 

project in order to maintain its license. (See §§ 7026, 7028, 7125, 7125.2.)

When ABI began its work on the project in August 2017, it had a 

workers’ compensation insurance policy issued through State Compensation 

Insurance Fund (State Fund). In December 2017, State Fund sent ABI a 

notice of cancellation, informing ABI that its 2017-2018 workers’

compensation policy would be canceled in January 2018 if ABI did not pay 

approximately $33,000 in outstanding premiums, which State Fund asserted 

were owed for ABI’s 2015-2016 policy based on an audit State Fund had 

performed in 2017.2

2

 State Fund first audited ABI’s 2015-2016 policy in spring 2017
5

ABI received Stand Fund’s notice of cancellation; it nonetheless 

failed to make payment. Accordingly, State Fund canceled ABI’s 2017-2018 

policy on January 25, 2018. Both the Board and ABI’s insurance broker 

notified ABI of the cancellation in writing shortly thereafter. 

ABI’s principal, Tin Vo, admittedly became aware of the policy 

cancellation no later than February 1, 2018. According to Vo, he was 

“blindsided” by the cancellation because State Fund had previously 

suspended collection of policy premiums during the audit dispute and had not 

previously canceled ABI’s policies.

As a result of the policy cancellation, ABI’s contractor’s license 

was suspended by operation of law on January 25, 2018, due to ABI’s “failure 

. . . to . . . maintain workers’ compensation insurance coverage.” (§ 7125.2.)

The Board gave ABI notice of the license suspension on January 29 and 

informed ABI that its contractor’s license would be suspended if ABI failed to 

submit a valid insurance certificate or exemption certificate within 45 days.

(See § 7125.2, subd. (b) [requiring registrar to give notice of license 

suspension].) ABI did neither. In mid-March, the Board sent ABI a letter 

notifying ABI that its license had been retroactively suspended effective 

January 25 under section 7125.2.

and told ABI it owed about $48,000 in premiums. ABI disputed the audit and 

the resulting bill, and State Fund put a hold on the bill to further investigate 

the matter. In late 2017, State Fund issued ABI a revised audit statement for 

roughly $15,000 less than had been previously billed. Still not satisfied, ABI 

continued to dispute the revised audit bill. State Fund acknowledged the 

premium dispute in January 2018 and informed ABI it would review the 

matter, but advised ABI it would nevertheless cancel the 2017-2018 policy 

effective January 25, 2018 if ABI did not pay the disputed bill before the 

cancellation date. 
6

The record establishes that Vo, ABI’s principal, knew that ABI’s 

policy had been canceled, that its license had been suspended, and that ABI

was therefore not to engage in construction activities. ABI nonetheless

continued work on the project, logging over one thousand hours on the project 

without workers’ compensation coverage or a contractor’s license in place.

According to Vo, ABI was between a rock and a hard place—either finish 

work and get paid, or quit and get nothing—so it had “no choice” but to 

continue the work.3

In an effort to get ABI’s contractor’s license reinstated, Vo filed 

an “Exemption from Workers Compensation” form with the Board in early 

April 2018, declaring under penalty of perjury that ABI does not need 

workers’ compensation insurance because it does “not employ anyone.” This 

was false. As Vo later admitted at trial, ABI had at least nine employees 

working on the project at the time. Vo nonetheless decided to falsely claim

the exemption because ABI was heavily invested in the project and he did not 

want to lose money. Upon receipt of the exemption form, the Board reinstated 

ABI’s license effective April 5, 2018. 

Meanwhile, ABI continued to dispute State Fund’s revised audit 

on the 2015-2016 policy, so State Fund assigned the collection of the 

outstanding premiums to a collection service, which filed a complaint against 

ABI and Vo in late 2018. In early 2019, State Fund issued its final audit 

statement on the 2015-2016 policy, asserting ABI owed about $23,000 

3 Although Vo claimed ABI lacked the resources to pay State 

Fund, ABI’s financial records indicate it had a net worth at the time of nearly 

$18 million, including roughly $500,000 in cash. 
7

(roughly $10,000 less than previously claimed). ABI failed to pay that 

premium.

As for the construction project, Balfour Beatty refused to pay ABI 

for its work. Accordingly, in May 2019, ABI sued Balfour Beatty and several 

construction bonding surety companies (collectively, Defendants) for fraud, 

breach of contract, quantum meruit, recovery against bonds, and statutory 

penalties. 

Balfour Beatty cross-complained against ABI and Vo for fraud, 

express indemnity, and equitable indemnity. Balfour Beatty also asserted as 

its 31st affirmative defense that ABI “was not properly licensed at all times 

as required by Business and Professions Code section 7031,” and as a result 

“is barred from recovering payment for any labor, materials or equipment 

furnished to the project.” 

Defendants filed a motion for summary judgment based on the

31st affirmative defense. In November 2020, just days before the hearing on 

that motion, and nearly three years after State Fund had canceled ABI’s 

workers’ compensation coverage, ABI settled its premium dispute with State 

Fund. As part of the settlement, ABI paid State Fund premiums in excess of 

$93,000 on the 2015-2016 and 2016-2017 policies; State Fund then withdrew 

its policy cancellation and reinstated the 2017-2018 policy.

Shortly thereafter, State Fund filed two certificates of workers’

compensation insurance with the Board, verifying ABI had insurance in place 

for the 2017-2018 and 2018-2019 policy years. ABI then applied to the Board 

for reinstatement of its license under section 7125.1, which permits the 

retroactive reinstatement of a suspended license if the licensee submits a 

valid certificate of workers’ compensation insurance and shows “that the 
8

failure to have a certificate on file was due to circumstances beyond the 

control of the licensee.” (See §§ 7125.2, subd. (c), 7125.1, subd. (b).)

As part of that application, Vo filed a form which stated under 

penalty of perjury that ABI’s lack of workers’ compensation insurance “was 

beyond my control because unbeknownst to me and [ABI], [State Fund] 

improperly submitted a cancellation notice to the [Board] for ABI’s 

February 21, 2017 to February 21, 2018 policy.” The Board apparently

accepted ABI’s representations, as it reinstated ABI’s license retroactively; 

the Board also revised ABI’s license history to remove the January 2018 

suspension under section 7125.2. 

In November 2022, the trial court held a bench trial on the 

bifurcated issue of Defendants’ 31st affirmative defense—ABI’s failure to be 

duly licensed. During trial, State Fund’s underwriting manager admitted

that State Fund had overcharged ABI for premiums, that State Fund 

generally does not cancel a policy for nonpayment of a bill until the dispute 

over the bill is resolved, that State Fund should not have canceled ABI’s 

2017-2018 policy, and that ABI’s license suspension occurred because of the 

way State Fund handled the dispute. 

After hearing testimony, admitting exhibits, and taking the 

matter under submission, the trial court issued a statement of decision

finding in favor of Defendants on the 31st affirmative defense, concluding 

ABI was “not ‘a duly licensed contractor at all times during the performance’ 

of the contract” and therefore “may not ‘bring or maintain’ this action ‘or 

recover’ compensation for its work.” The court then entered judgment in favor 

of Defendants and against ABI. ABI filed a notice of appeal from the 

judgment. 
9

Defendants filed a motion for attorney fees under Civil Code 

section 1717 and the subcontract’s prevailing party fee provision.4 The parties 

also filed motions to tax costs. After granting the motions in part, the trial 

court entered an amended judgment in favor of Defendants and against ABI, 

which included an award of over $270,000 in costs and over $1.55 million in 

attorney fees to Defendants. ABI filed a second notice of appeal from the 

attorney fee award. We consolidated the two appeals at ABI’s request. 

DISCUSSION

I.

THE APPLICABILITY OF SECTION 7031

We first consider the trial court’s finding that section 7031 bars 

ABI from maintaining this action because it was not ‘“a duly licensed 

contractor at all times during the performance”’ of its contract from July 2017 

through May 2018.

The parties dispute the applicable standard of review. ABI 

maintains this is a matter of statutory interpretation which requires de novo 

review, while Balfour Beatty asserts the issue of whether ABI was a “duly 

licensed contractor at all times” is a factual question subject to substantial 

evidence review. Though we tend to agree with Defendants, we need not 

resolve the question of which standard of review applies, because under 

either standard, our conclusion would be the same.

The facts before us are straightforward. To summarize, on 

January 25, 2018, midway through its work on the project, ABI’s workers’

4 Under Civil Code section 1717, in an action on a contract that 

provides for attorney fees and costs to the prevailing party, the prevailing 

party (as determined by the court) is entitled to reasonable attorney fees as 

an element of costs.
10

compensation policy was canceled because of its refusal to pay outstanding 

insurance premiums allegedly owed for a previous policy, and ABI’s 

contractor’s license was automatically suspended by operation of law that 

same day. (§ 7125.2.) ABI’s principal became aware of the policy cancellation 

no later than February 1, 2018, but he did not take any steps at the time to 

have the policy reinstated or to procure coverage elsewhere. Instead, ABI

continued its work knowing it was uninsured and unlicensed. In April 2018,

in an effort to get its license reinstated, ABI falsely represented to the Board, 

under penalty of perjury, that it was exempt from workers’ compensation 

insurance requirements because it had no employees.

More than two years later, midway through the pending 

litigation with Defendants, ABI paid over $93,000 to settle its premium 

dispute with State Fund, which then retroactively reinstated its 2017-2018 

policy. ABI then applied to have its contractor’s license retroactively 

reinstated; in doing so ABI represented to the Board that the lapse in 

workers’ compensation coverage had been “due to circumstances beyond [its] 

control,” in that the policy had been canceled, “unbeknownst to” ABI. The 

Board retroactively reinstated ABI’s license.

We must decide whether, given these facts, ABI was “duly 

licensed . . . at all times during the performance of” its work. If it was not, 

section 7031 bars ABI from bringing or maintaining the present action to 

collect compensation for its work.

To establish it was duly licensed at all times, ABI relies on the 

Board’s contractor’s license history for ABI. Thanks to the various retroactive 

reinstatements described above, this document currently reflects that ABI 

was licensed continuously throughout the project. 
11

That certificate of licensure, however, creates only a rebuttable 

presumption of licensure. (Buzgheia v. Leasco Sierra Grove (1997) 

60 Cal.App.4th 374, 391−392.) A party may attack that presumption “by 

going behind the face of the license” and proving it is in fact a “‘sham,’” and 

courts have found a license invalid notwithstanding the certification. (Id. at 

p. 385; see Vascos Excavation Group LLC v. Gold (2022) 87 Cal.App.5th 842, 

851 [contractor’s production of certificate of licensure is insufficient if 

opposing party disputes whether contractor was properly licensed]; see, e.g., 

Wright v. Issak (2007) 149 Cal.App.4th 1116, 1119, 1121 [contractor’s lawsuit

was barred, notwithstanding facially valid license, where license was 

automatically suspended by operation of law because the contractor avoided 

obtaining workers’ compensation insurance by falsely claiming to have no 

employees].)

In this case, we find ABI was not entitled to retroactive 

reinstatement of its license under section 7125.2. Because ABI applied for 

retroactive reinstatement of its license more than 90 days (in this case, 

nearly three years) after the effective date of the certificate of insurance, the 

Board could only reinstate the suspended license if “the failure to have a 

certificate on file was due to circumstances beyond the control of [ABI].”

(§§ 7125.2, subd. (c), 7125.1, subd. (b).) Here, neither the policy cancellation 

nor the continued failure to have insurance on file were outside ABI’s control.

In ABI’s request for reinstatement, Vo represented to the Board, 

under penalty of perjury, that ABI’s lack of workers’ compensation insurance 

“was beyond my control because unbeknownst to me and [ABI], [State Fund] 

improperly submitted a cancellation notice to the [Board] for ABI’s 

February 21, 2017 to February 21, 2018 policy.” That representation was

false. State Fund canceled the 2017-2018 policy effective January 25, 2018,
12

because ABI made a considered decision not to pay the premiums due on the 

previous policy.

The cancellation was not “unbeknownst to” ABI. Even if the 

cancellation came as a surprise (Vo testified he did not think State Fund 

would actually cancel the policy despite its threat to do so given the pending 

audit dispute), ABI became aware of the policy’s cancellation no later than 

February 1, 2018. Yet ABI made no effort to have the policy reinstated or to 

obtain insurance elsewhere, despite having the wherewithal to do so.

Once the policy was canceled, ABI had a duty to “obtain” 

coverage elsewhere if it intended to continue to work on Balfour Beatty’s

project. (See § 7125.2, subd. (a).) It failed to do so. Instead, it falsely 

represented to the Board, under penalty of perjury, that ABI was exempt 

from workers’ compensation insurance requirements because it had no 

employees. When it elected not to pay the premium due or procure workers’

compensation insurance elsewhere, ABI compromised the safety and security

of its workers. It was not until over two years later, when faced with 

Defendants’ motion for summary judgment, that ABI agreed to pay the 

2015-2016 policy premium so that its 2017-2018 policy would be retroactively 

reinstated. 

ABI has not shown its lapse in workers’ compensation coverage 

“was due to circumstances beyond [its] control.” (§ 7125.1, subd. (b), italics 

added.) The Board, therefore, lacked the power to reinstate ABI’s suspended 

license retroactively. (§ 7125.2, subd. (c).) That in turn means ABI was not 

“duly licensed . . . at all times during the performance of” its work. (§ 7031, 

subd. (a), italics added.) Accordingly, section 7031 bars ABI from bringing or 

maintaining the present action against Balfour Beatty to collect 
13

compensation for its work on the project, “regardless of the merits of [ABI’s] 

cause of action” against Balfour Beatty. (Ibid.)

The fact that State Fund retroactively reinstated the 2017-2018

policy in November 2020 as part of its settlement with ABI does not compel a 

different result. As the trial court aptly noted, “An ABI employee injured on 

January 26[, 2018] would have had no coverage. By the time ABI got 

retroactive coverage years later, both ABI and State Fund knew there had 

been no claims against ABI. Insurance that covers a period known to be 

claim-free is no insurance at all; it is window dressing. It encourages 

contractors to gamble on letting their workers’ compensation insurance lapse 

and papering over the coverage gap later with retroactive ‘insurance’ that 

covers nothing.”

ABI focuses much of its argument on the fact that State Fund 

eventually admitted it had overcharged ABI and should not have canceled

the policy. According to ABI, State Fund’s improper policy cancellation was 

“void” and “defective,” and ABI never would have had its license suspended if 

State Fund had acted properly.

This argument falls flat factually. First, State Fund’s late 2017 

demands for payment were apparently not unfounded, as ABI paid State 

Fund over $93,000 in premiums as part of the November 2020 settlement.

Second, the fact that State Fund overstated the amount of premiums due in 

late 2017 does not exonerate ABI from failing to obtain insurance elsewhere

after its policy was canceled. Rather than doing so, ABI elected to continue its 

work on the project, knowing it was uninsured and unlicensed.

ABI alternatively argues it cannot be subject to section 7031’s bar 

on recovery because ABI substantially complied with the licensing 

requirements. We are not persuaded. A court may only find substantial 
14

compliance with the licensure requirements if the contractor “(1) had been 

duly licensed as a contractor in this state prior to the performance of the act 

or contract, (2) acted reasonably and in good faith to maintain proper 

licensure, and (3) acted promptly and in good faith to remedy the failure to 

comply with the licensure requirements upon learning of the failure.” (§ 7031, 

subd. (e).) We decline to find ABI acted in good faith, given its repeated false 

declarations to the Board. It also failed to act promptly, given that it waited

nearly three years to settle its policy premium dispute with State Fund.

Citing the Eighth Amendment to the United States Constitution, 

ABI maintains the application of section 7031 is unconstitutional in that it

arbitrarily and excessively punishes ABI by precluding any recovery for its 

work. Again, we are not persuaded.

The legitimacy of the public policies underlying California’s 

licensing laws and the validity of section 7031 are well established. As our 

Supreme Court has observed, California’s licensing laws are intended “to 

protect the public from incompetence and dishonesty in those who provide 

building and construction services,” and the “licensing requirements provide 

minimal assurance that all persons offering such services in California have 

the requisite skill and character, understand applicable local laws and codes, 

and know the rudiments of administering a contracting business.” (Hydrotech 

Systems, Ltd. v. Oasis Waterpark (1991) 52 Cal.3d 988, 995 (Hydrotech).)

“Section 7031 advances this purpose by withholding judicial aid from those 

who seek compensation for unlicensed contract work. The obvious statutory 

intent is to discourage persons who have failed to comply with the licensing 

law from offering or providing their unlicensed services for pay.” (Ibid.)

“Because of the strength and clarity of this policy, it is well 

settled that section 7031 applies despite injustice to the unlicensed 
15

contractor. ‘Section 7031 represents a legislative determination that the 

importance of deterring unlicensed persons from engaging in the contracting 

business outweighs any harshness between the parties.’” (Hydrotech, supra, 

52 Cal.3d at p. 995.) The result is “a stiff all-or-nothing penalty for unlicensed 

work.” (MW Erectors, Inc. v. Niederhauser Ornamental & Metal Works Co., 

Inc. (2005) 36 Cal.4th 412, 426.) The statute itself specifies that it applies 

“regardless of the merits of the cause of action brought by” the plaintiff 

(§ 7031, subd. (a)), and its “harsh results are justified by the importance of 

deterring violations of the licensing requirements” (White v. Cridlebaugh

(2009) 178 Cal.App.4th 506, 518, 519).

We agree with the trial court that section 7031 bars ABI from 

maintaining this action because it was not a “duly licensed contractor at all 

times during the performance of” its contract. (Id., subd. (a).) We therefore 

affirm the judgment.

II.

ATTORNEY FEES

We next consider the award of over $1.55 million in attorney fees 

to Defendants under Civil Code section 1717 and the subcontract’s prevailing 

party attorney fee provision. Although normally we review attorney fee 

awards for abuse of discretion, where, as here, the appeal presents a legal 

question of whether the criteria for an attorney fee award have been 

satisfied, our review is de novo. (Mountain Air Enterprises, LLC v. 

Sundowner Towers, LLC (2017) 3 Cal.5th 744, 751 (Mountain Air).)
16

ABI contends Balfour Beatty is not entitled to attorney fees 

because it did not prevail on the contract; rather, it only succeeded in 

asserting a statutory affirmative defense.5 We disagree. 

When a litigant prevails in an action on a contract by 

establishing that the contract is invalid or unenforceable for reasons other 

than illegality, Civil Code section 1717 permits that party’s recovery of 

attorney fees if the opposing party would have been entitled to attorney fees 

under the contract had it prevailed. (Santisas v. Goodin (1998) 17 Cal.4th 

599, 611; California-American Water Co. v. Marina Coast Water Dist. (2017) 

18 Cal.App.5th 571, 579.) That is essentially what occurred here. Defendants

established the subcontract was unenforceable by ABI under Business and 

Professions Code section 7031, so Civil Code section 1717 permits

Defendants, as the prevailing parties in ABI’s contract action, to recover 

attorney fees under the subcontract’s attorney fee provision. (See Pacific 

Custom Pools, Inc. v. Turner Construction Co. (2000) 79 Cal.App.4th 1254, 

1258−1259, 1268 [contractor who defeated cross-complaint by unlicensed 

subcontractor under § 7031 was entitled to prevailing party attorney fees 

under § 1717].)

ABI cites Mountain Air, supra, 3 Cal.5th 744, to support its 

argument that a contract provision awarding fees to a prevailing party is not 

available if an affirmative defense voids the contract claim. ABI 

misapprehends the case’s holding. In Mountain Air, the sellers in a real 

estate transaction sued the buyers for failing to purchase the subject 

property, and the buyers successfully asserted novation as an affirmative 

5 ABI does not assert the amount of fees is unreasonable or 

improper.
17

defense, establishing the purchase agreement had been superseded by the 

parties’ option agreement. (Id. at p. 747.) The Supreme Court determined the 

buyers could not recover attorney fees under the option agreement’s attorney 

fee provision, which allowed the prevailing party to recover attorney fees in 

“‘any legal action or any other proceeding . . . brought for the enforcement of 

this Agreement’” (id. at p. 752), because no party brought a legal action to 

enforce the option agreement. The buyers instead asserted the option 

agreement as an affirmative defense to claims under a different agreement.

(Id. at pp. 752−755.)

Here, by contrast, ABI filed suit to enforce the subcontract, 

thereby triggering the subcontract’s attorney fee provision. As the prevailing 

party in that action, Defendants are entitled to attorney fees; the fee award 

must therefore be affirmed.

DISPOSITION

The judgment and postjudgment order are affirmed. Defendants

shall recover their costs on appeal. (Cal. Rules of Court, rule 8.278(a).)

GOETHALS, ACTING P. J.

WE CONCUR:

MOTOIKE, J.

DELANEY, J.