Source: https://www.calattorneysfees.com/page/2/
Timestamp: 2019-04-25 16:16:38+00:00

Document:
As reported on March 27, 2019 in the on-line version of The Hollywood Reporter, Vice Media has agreed to settle a female gender pay gap class action for about $1.875 million in a Los Angeles County Superior Court case. The class involved around 675 members, with attorneys to receive $665,000 in costs/fees and with most of the remaining amount to go to class members where it is projected each member will receive a pre-tax distribution of $1,600.
Plaintiffs Recovered $8,500; Sought Fees Of $171,000; Were Awarded Fees Of $37,250.
Lack of success in a case can certainly impact fee recovery to prevailing parties, as Almaguer v. Newland Entities, Inc., Case No. C075662 (3d Dist. March 27, 2019) (unpublished), demonstrates.
There, two plaintiffs partially prevailed on certain labor/wrongful termination claims, but lost certain tort, labor, and unfair competition claims. In the end, they recovered $8,500 in compensatory damages. They then moved to recoup over $171,000 in fees under Labor Code section 218, which is a pro-plaintiff mandatory fee-shifting statute. The defense opposed on the grounds that plaintiffs had limited success and need to apportion fees between successful/unsuccessful claims. The trial judge agreed, eventually awarding about 20% of the request--$37,250.
Plaintiffs’ appeal of the fee award was unavailing.
Under Chavez v. City of Los Angeles, 47 Cal.4th 970, 989 (2010) [our Leading Case No. 13] and other cases, lack of success is a factor to be considered under a fee petition. The Third District saw no reason that this should not apply under Labor Code section 218. Beyond that, the trial judge did not err in apportioning fees between successful/unsuccessful claims and also deciding that having two attorneys at trial was “overkill.” Fee award affirmed on appeal.
Unlike Other Fee Areas, Brown Act Fee Award Must Specifically Set Forth Predicate Findings.
We learn something just about every day by blogging. California’s Brown Act—designed to promote governmental transparency through opening meeting protections—does have a fee-shifting clause in Government Code section 549605.5, which allows an award of fees and costs where defendant has prevailed in a final determination and the court finds the action was clearly frivolous and totally lacking in merit. Interestingly enough, case law has established because such an award is akin to a sanction, it is necessary for the trial judge to specify the factors which led to a conclusion that the action was frivolous/lacking in merit. (Boyle v. City of Redondo Beach, 70 Cal.App.4th 1109, 1121 (1999).) Most times, a fee award does not have to be supported by a statement of decision, although there are exceptions.
In Olson v. Hornbook Community Services Dist., Case No. C084494 et al. (3d Dist. March 25, 2019) (partially published; fee discussion not published), plaintiffs did suffer judgments of dismissal in favor of District in several Brown Act cases, with the trial judge awarding it fees and costs under section 549605.5. However, because the ultimate order doing so was void (it was a subsequent, impermissible correction of judicial error) and failed to specify the bases for a costs/fee award, it had to be reversed.
Section 1717 Allows For Recovery “On A Contract,” Not For Fraud.
An individual defendant in High Sierra Properties, Inc. v. Mitchell, Case No. B280201 (2d Dist., Div. 7 March 25, 2019) (unpublished) was feeling pretty good after winning a nonsuit in which he was sued for fraud, both individually and as an alter ego of a corporate defendant. Plaintiff and corporate defendant were parties to a contract with a fees clause, but the individual defendant was not. However, he argued that, under Reynolds Metals [our Leading Case No. 5], he was entitled to prevailing party fees based on defeating the alter ego fraud allegations. The trial court disagreed, denying his fee request. The 2/7 DCA affirmed for a simple reason: individual defendant’s win on the fraud claim was not “on a contract” so as to allow for reciprocal fee recovery under Civil Code section 1717.
However, Appealing Ex-Wife Not Awarded Costs On Appeal For Failure To Direct Trial Court’s Attention To This Omission.
What happened in Marriage of Aldridge, Case No. G055666 (4th Dist., Div. 3 March 22, 2019) (unpublished) is that a family law judge, commendably trying to end a case, denied a section 271 sanction request (a determination which was affirmed) and awarded a small amount of needs-based fees to ex-wife under section 2030 without making any of the required findings (a determination which was reversed). The appellate court could not find this error to be harmless in nature given that wife did submit financial data showing she was unemployed. Although that required a reversal and remand, the appellate panel—in an opinion penned by Acting Presiding Justice Bedsworth—did not award appellate costs to ex-wife because she could have brought this omission to the lower court’s attention.
Lower Court Should Have Credited Parties’ Admissions, With No Invited Error Based On Record Before The Lower Court.
If you, as a litigant, make an admission as to fee entitlement, but then try to change course based on a trial court’s different path, you may be bound by the admission in an appeal and get a reversal if the trial court fails to honor your admission.
Arkius, Inc. v. Yeh, Case No. B278568 (2d Dist., Div. 1 March 21, 2019) (unpublished) is a case in which this happened.
After prevailing on the merits, plaintiff moved for contractual attorney’s fees recovery under two contracts. The lower court awarded fees under one ($65,336.83 out of a requested $104,393.53), but it denied requested fees altogether on the second contract. In the paperwork underlying the fee motion, defendants admitted that there was fee entitlement under both contracts. However, at the hearing, the trial judge denied the fees on the second contract because the complaint attachment of the contract did not contain the fee provision.
Plaintiff appealed, and the 2/1 DCA reversed. The reason was that the parties’ admission in the fee proceeding really conceded fee entitlement. This meant that there was no invited error despite the missing page because of the parties’ admission of entitlement. Aside from a remand to calculate fees owed on contract two, the amount of fees for contract one had to be relooked at because the future recovery on contract two could impact the prevailing party analysis on the whole gestalt.
Defendant Failed To Meet RFA Costs Of Proof Burden Or Segregate Out Costs For Actually Proving Truths Of Matters In A Demurrer Proceeding, While Plaintiff’s Request For 128.7 Sanctions In An Opposition Was Procedurally Infirm.
I guess we can say that the results in Eng v. Brown, Case No. D072980 (4th Dist., Div. 1 March 21, 2019) (unpublished) shows how meeting procedural requirements or burden of proof elements are keys in winning RFA costs-of-proof sanctions or CCP § 128.7 sanctions requests.
In this one, the defendants prevailed after a jury trial against plaintiff, moving for costs of proof sanctions for request for admissions denials under CCP § 2033.420 and for CCP § 128.5 sanctions. In response, plaintiff asked for CCP § 128.7 sanctions against the defense for bringing frivolous motions, but only doing so through an opposition to the defense motions. The lower court denied the defense motions and never really ruled on plaintiff’s 128.7 request.
The 4/1 DCA affirmed the defense appeal of the costs of proof sanctions denial and plaintiff’s cross-appeal of the 128.7 request denial.
Defense Appeal. The problem with some of the costs of proof requests was that defendants failed to prove to the trial judge what they had to prove in the truth of certain facts with respect to RFA denials. They never submitted trial transcripts before the lower court so it could make the determination; simply supplying them on appeal did not help as far as showing how the lower court abused its discretion. However, the defense did win a demurrer with respect to a conversion cause of action for which certain RFA denials were made. Although expressing skepticism that CCP § 2033.420 could be used at a demurrer stage of proceedings, the appellate court assumed it could but found that the defense failed to isolate expenses relating to the denials at issue—instead, the defense sought all fees applicable in the demurrer proceeding, which did not meet its burden to segregate under section 2033.420.
Plaintiff’s Cross-Appeal. The flaw in this cross-appeal was that Plaintiff never made a separate motion for 128.7 sanctions. Rather, plaintiff simply made a request for them in the opposition to the 2033.420/128.5 motions by the defense—a procedurally improper method of requesting 128.7 sanctions.
Result Was A $190,499 Fee Exposure.
The appellate court in Stubblefield Properties v. Jacinto, Case No. D074718 (4th Dist., Div. 1 March 18, 2019) (unpublished) was not unsympathetic to a $190,499 fee recovery socked on a litigant where attorney malpractice was potentially involved. However, there was no basis to reverse, where the request was made 2 years down the line. The problem was that there was no extrinsic fraud or total attorney abandonment under Daley which might have led to relief. The ultimate problem was the fee recovery had entitlement under the Mobilehome Residency Law and FEHA, such that nothing more could be done.
No Abuse Of Discretion Shown, With No Binding Requirement To Allocate Or Reduce For Some Lack Of Success.
City of Walnut v. Mt. San Antonio Community College Dist., Case No. B287619 (2d Dist., Div. 5 March 15, 2019) (unpublished) is a situation where City petitioned to stop work on a solar energy general facility being constructed by District, receiving partial relief in the form of a “construction halt” based on the need for CEQA compliance and the need for a local grading/haul route approvals. (However, City did not win other arguments, namely, that the project violated its general plan and that other local permits were required.) City requested $543,731 in attorney’s fees as the prevailing party, with the lower court awarding it the full request. District appealed.
The full fee award was affirmed by the 2/5 DCA. The lower court had determined that City achieved its full litigation objective, although not winning every challenge—with the CEQA victory being the overriding success. On appeal, District mainly argued that some reduction or allocation was in order based on lack of success on some challenges. The appellate court determined that CCP § 1021.5 does allow for fee compensation relating to unsuccessful efforts, citing the Sundance and Sokolow decisions. The lower court’s unwillingness to adopt District’s suggested 50% reduction was no abuse of discretion, either.
BLOG OBSERVATION—Co-contributor Mike has been involved on some fee appeals involving this issue. He believes that some legislative tweaking of these rules is in order. Many times, CEQA petitioners bring twenty or more challenges, but prevail on only one or two. There are some federal cases holding that the fees for unsuccessful challenges should not all be borne by the governmental entity or developer who actually did win on such challenges. Although a strict mathematical test is likely not the solution, there should be a way to fashion some proportionality rules which will make CEQA petitioners more “choosey” in the way they approach their challenges at an upfront prosecution stage of the proceeding. Ex-Governor Jerry Brown said CEQA reform was part of the “Lord’s work”; if so, this is an area in need of reform.
60% Total Positive Multiplier And Lodestar Awards Were No Abuse Of Discretion.
In Holloway v. Vierra, Case No. H044505 (6th Dist. March 14, 2019) (unpublished), a plaintiff taxpayer challenged a defendant water district director’s receipt of real estate commission benefit in a District real estate purchase under the Political Reform Act. Plaintiff earlier suffered a demurrer without leave, but later revived the action through a successful appeal generating a published opinion. Plaintiff eventually prevailed after a trial, moving for fee recovery under both Government Code section 91003(a) and California’s private attorney general statute. The trial judge awarded him $116,647.47, inclusive of a 60% positive multiplier to bring his attorney’s discounted fees to Bay Area market prices and 10% of the total being a reward for championing a difficult case.
The Sixth District affirmed the fee award against defendant. There was fee entitlement under both statutory bases. The amount of the fees granted by the lower court was no abuse of discretion. The multiplier properly compensated plaintiff’s attorneys for discounted rates in getting to the proper lodestar amount, with the difficulty and uncertainty of the case also supporting a positive enhancement.
Storage Facilities Had A Clear Fee Entitlement Provision, With Another Provision Not Capping Them At All—With Reasonable Fees Being The Only Limitation.
In Enjati v. Big Bear Moving, Inc., Case No. E068332 (4th Dist., Div. 2 Mar. 13, 2019) (unpublished), defendants were awarded contractual attorney’s fees after prevailing at trial on a storage facility dispute. Defendants sought $47,292 in fees, but they were awarded $40,642 instead. Losing plaintiff appealed, to no avail. Plaintiff could not beat the fact that there was a fee entitlement contractual provision, which was not capped by another provision which only put a “reasonable fee” limitation generally applicable under Civil Code section 1717 anyway on fee recovery. Fee award affirmed.
The Broadway Hollywood is a 10-story historical building on the corner of Hollywood and Vine. It was constructed in 1927 and originally used as a store. However, the building was abandoned in 1987 and remained vacant for 18 years – until it was revitalized and converted from an obsolete building to modern use. Today the Broadway Hollywood is a common interest development managed by a homeowners association – with the Davis-Stirling Act (Civ. Code section 4000) governing such developments.
In Yu v. Broadway Hollywood Homeowners Assn., Case No. B280977 (2d Dist., Div. 1 March 7, 2019) (unpublished) Plaintiff, who owns a condominium in The Broadway Hollywood, sued the homeowners association, alleging it violated its governing documents by failing to offer valet parking (development was deficient in meeting current parking code requirements, and was granted a variance to allow for off-site parking) in her first cause of action; for interfering with homeowners’ 2013 and 2014 board elections, in which she sought election, respectively in her second and third causes of action; and for breach of fiduciary duty in her unsuccessful fourth cause of action.
Association SLAPPed back against Plaintiff’s claims regarding interference with the election – stating it was simply exercising its protected activity of right of petition. The trial court, while finding the “thrust” of the claim arose from unprotected activities, found that Plaintiff was not likely to prevail on this issue. On appeal, the matter was remanded for further proceedings – with the trial court ultimately denying Association’s anti-SLAPP motion. While the SLAPP appeal was pending, a bench trial was held on the parking violation issue, with the trial court finding in favor of Plaintiff. Post-trial, the trial court also awarded Plaintiff attorney fees, pursuant to Civ. Code section 5975, subd. (c), of $114,990.75 (which included Plaintiff’s requested $112,549.75 after her detailed reduction for time spent on claims in which she did not prevail, plus $2,440 for time and costs incurred by Plaintiff’s attorney in connection with the fee motion). Association appealed the judgment, the order denying its anti-SLAPP motion, and the attorney fees award to Plaintiff – claiming the trial court had abused its discretion in awarding these fees.
The 2/1 DCA disagreed with Association at every turn, and affirmed on appeal. As to the fees, they found that Plaintiff was the prevailing party as she had achieved her main litigation objectives. To that end, citing PLCM Group, Inc. v. Drexler (2000) 22 Cal.4th 1084 [our Leading Case No. 1] and Serrano v. Priest (1977) 20 Cal.3d 25 [our Leading Case No. 3], the 2/1 DCA found that the trial court’s order took into consideration the claims on which Plaintiff did not prevail, and that nothing in the record suggested the award was arbitrary or exorbitant.
In Point San Pedro Road Coalition v. County of Marin, Case No. A152144 (1st Dist., Div. 3 March 6, 2019), Defendant County and Real Party in Interest (a rock Quarry) jointly appealed a lower court’s order awarding Plaintiff with $368,959 in attorney fees.
Plaintiff had filed two, separate petitions against County to challenge an amendment County approved to Quarry’s mining permit – allowing Quarry to import asphalt grindings onto its site for use in the production of asphaltic concrete – and County’s later extension of the amendment. Plaintiff’s contention was that the amendment (and extension thereof) allowed for an impermissible expansion of Quarry’s nonconforming use in violation of the County zoning ordinance.
With regard to its first petition to challenge the initial amendment, Plaintiff had participated in administrative proceedings, but had not filed an appeal with the California State Mining and Geology Board. Defendant moved for judgment on the pleadings on this basis, alleging that Plaintiff failed to exhaust its administrative remedies before seeking judicial relief. The trial court agreed and dismissed the petition. Plaintiff appealed.
During appeal of Plaintiff’s first action, County granted Quarry an extension of the amendment. In opposition, Plaintiff pursued its administrative remedies – including an appeal with the California State Mining and Geology Board – before seeking judicial relief in its successful second petition. About two months after the trial court granted Plaintiff’s second petition and directed County to vacate the amendment extension, the 1/3 DCA reversed the trial court’s order on Plaintiff’s first action – remanding the matter to the trial court with instructions to dismiss on the grounds of mootness.
Plaintiff then sought an aggregate award of $658,805 in attorney fees, for the work performed in both actions ($335,260 for the first action, and $191,784 for the second, plus multipliers for each), under Code Civ. Proc. section 1021.5 (which allows award of attorney fees to successful party in action which results in the enforcement of an important right affecting public interest). The trial court awarded attorney fees in the aggregate sum of $368,959 ($115,151.50 for the first action, $192,314 for the second (which included an additional $530 for one hour of oral argument), and a multiplier of 1.2 applied to both sums) – explaining that the legal work associated in the first action “was closely related to the second action and was useful to the resolution of the second action.” Defendant and Quarry appealed.
The 1/3 DCA affirmed – relying on Serrano v. Unruh (1982) 32 Cal.3d 621 – concluding that fees were recoverable under section 1021.5 for the first action as necessary in establishing Plaintiff’s claim in the second action.
The Davis-Stirling Act (Civ. Code section 4000 et seq.) governs the creation and operation of common interest developments, and requires such developments to be managed by a homeowners association, which homeowners are generally mandated to join.
In Bertoli v. Dennis, Case No. A150924 (1st Dist., Div. 5 March 5, 2019) (unpublished), a Board of Governors had been elected for the homeowners association managing a common interest development consisting of improved and unimproved lots in Mendocino County. This Board of Governors had been elected by former owners of the improved lots and their daughter (who collectively owned 10 unimproved lots). Upon election of the Board, certain assessments were levied against 12 homeowners of the 6 improved lots within the development. The assessments went unpaid, and the association employed a debt collection agency that recorded assessment liens against the homeowners.
In contesting the validity of the assessment liens, Homeowner Plaintiffs filed an unsuccessful declaratory relief action against the debt collection agency and original owners of the development (who had elected the homeowners association board).
The debt collection agency based its successful motion for summary judgment on the fact it had released the liens, no longer worked for the homeowners association (because the association failed to defend or indemnify it), and were no longer parties in interest – therefore, no actual controversy existed as to them.
Plaintiffs also lost in dueling summary judgment motions with the former owner Defendants. Each sought judicial construction of the key language in the Covenants concerning voting rights – with Plaintiffs believing the language to mean that only owners of improved lots have voting rights. The trial court, however, agreed with the former owner Defendant’s interpretation that the owners of all lots (improved or unimproved) have voting rights, and entered judgment in their favor. Additionally, the trial court granted the former owner Defendants’ opposed request for prevailing party attorney fees – awarding $125,796.50 in fees under Civil Code sections 1717 and 5975.
Plaintiffs unsuccessfully appealed the summary judgment rulings and attorney fees award – with the 1/5 DCA affirming on appeal, finding no trial court error in granting summary judgment to Former Owner Defendants with regard to voting rights, nor to debt collection agency due to the lack of an actual controversy. The 1/5 DCA further determined that the attorney fees award to former owner Defendants was proper as the Davis-Stirling Act provided the statutory basis for fee shifting in this action.
The Insurance Company of The State of Pennsylvania v. American Safety Indemnity Company, Case No. B283684 (2d Dist., Div. 8 March 1, 2019) (published) involves a dispute between insurers resulting from an underlying case. The underlying case involved a Homeowner Couple who sued a Homebuilder General Contractor for defective construction. Their home had been constructed on a lot that had been improperly compacted by a Grading Subcontractor under a contract with Homebuilder. The resulting settling damage to Homeowner’s home was so significant that a construction engineer concluded the entire structure was compromised and should be demolished and rebuilt at a cost of almost $1.9 million. The case went to arbitration, with Homeowner alleging “at least $2,347,592” in damages against Homebuilder. The arbitrator found in favor of Homeowner, and awarded damages of $1,026,750, attorney fees of $1,122,625, costs of $8,840.38, plus prejudgment interest of $28,417.84 – for a total recovery of $1,176,633.22.
Homebuilder initiated a lawsuit against Subcontractor pending the outcome of arbitration – obtaining a default judgment against Subcontractor for $1,532,973.87 (Homeowner’s arbitration award of $1,176,633.22 as damages, plus attorney fees of $356,340.65) pursuant to indemnity provisions in a contract between the parties (which also provided for attorney fees).
Because Homebuilder’s Insurer fully indemnified it for the arbitration award to Homeowner, it then sued Subcontractor’s Insurer for recovery of the default judgment under Insurance Code section 11580 (a contractual action on the policy to satisfy a judgment up to policy limits), along with causes of action for declaratory relief, subrogation, and breach of contract – alleging Subcontractor Insurer had: (1) a duty to indemnify Subcontractor for the amount of the default judgment; and (2) policies that provided coverage for the entire amount of the default judgment. Homebuilder Insurer further alleged it was subrogated to Homebuilder’s rights to recover by virtue of having indemnified Homebuilder for the arbitration award.
Both Insurers moved for summary judgment, with the trial court denying Subcontractor Insurer’s motion, granting Homebuilder Insurer’s motion, and entering judgment in favor of Homebuilder Insurer in the amount of $1,532,973.87 plus prejudgment interest. Subcontractor Insurer then filed a motion for a new trial, which was denied, so it filed an appeal.
On appeal, Subcontractor Insurer made the same summary judgment arguments it had made in the lower court, but added a few additional arguments for the first time on appeal. The new arguments were not considered by the 2/8 DCA, and the remaining arguments proved to be of no avail to Subcontractor Insurer.
In affirming the trial court’s summary judgment rulings, the 2/8 DCA determined that the underlying default judgment was valid under Code Civ. Proc. section 580 (default judgment cannot exceed amount requested in complaint) as Homebuilder clearly stated that it sought indemnity for the underlying arbitration in an amount of at least $2,347,592 – an amount significantly higher than the default judgment award. It further determined that the default judgment was indeed based upon property damage – not economic loss as argued by Subcontractor Insurer.
Dispute Was Covered Under CC&R’s Fee Provision.
In Hunkel v. Gerhardt, Case No. H044753 (6th Dist. March 12, 2019) (unpublished), two neighboring homeowners squared off in a dispute over the placement of a fence by one homeowner group. The defendant homeowners claimed that there was no proper board of directors making a decision on the fence dispute, a position ultimately embraced by the trial court. The lower court then awarded prevailing defendants $111,215.50 against losing plaintiffs under both Civil Code section 1717 (the former based on a CC&R fee clause) and Civil Code section 5975 (the latter being a Davis-Stirling Act fee-shifting provision).
The Sixth District affirmed, based on the Civil Code section 1717 rationale alone.
Plaintiff neighbors, the losing parties, did sue for declaratory relief, a classic contractual claim covered by a broadly-worded CC&R provision providing for fee entitlement even by individual homeowners. Defendant neighbors did prevail on a liminal board authority issue, an issue which allowed fee recovery even though they obtained no affirmative relief.
His Anger Over Another Probate Dispute Was The Driving Cause So That Claimed Conservatorship Fees Were Unreasonable.
Probate is one of those areas where attorney’s fees recoveries are guided, overwhelming, by equitable principles. Reaume v. Reaume, Case No. G054759/G054864 (4th Dist., Div. 3 March 12, 2019) (unpublished) well demonstrates this reality.
There, one brother of a mother’s estate petitioned to invalidate a quitclaim deed executed by his mother to another brother, prior to her death, based on her incapacity and undue influence. The trial court rejected both theories, as well as denying one brother’s attorney’s fees incurred in unsuccessfully petitioning for a conservatorship in relation to his mother.
Everything was affirmed on appeal, in an opinion authored by Justice Goethals. With respect to the fees award, the lower court rationally determined that the conservatorship request was an angry reaction by one brother to an estate sale by the other brother such that the fees were not tethered to any need for protection of the mother. The record showed mother’s needs were being met such that fees were not warranted for the unsuccessful conservatorship efforts.
In Martello v. Buck, Case No. B285001 (2d Dist., Div. 1 March 1, 2019) (unpublished), Plaintiff Doctor sued Defendants Patient husband and his wife for defamation, assault, and intentional infliction of emotional distress after Defendants expressed dissatisfaction with Plaintiff’s billing practices on the internet. Defendants filed a cross-complaint for malicious prosecution, claiming Plaintiff had pursued litigation to collect on medical “balance billing” that Plaintiff knew to be illegal as they alleged she had been ordered by the Dept. of Managed Health Care to cease and desist from balance billing her patients. Balance billing is the practice of charging patients for the amount of the bill not covered after the insurance company pays its obligation, and patient has paid his/her deductible, copays, etc. It is illegal in California.
In the underlying case, Plaintiff Doctor had obtained a default judgment against Defendants for the unpaid balance of the medical bill, and had attempted to collect by forcing a sale of Defendants’ home. Defendants were able to obtain relief from the default judgment and avoid sale of their home.
The parties settled their claims against each other after months of negotiations. However, Plaintiff changed later changed her mind and refused to enter the settlement agreement in court. Afterward, following a bifurcated trial, the trial court found the settlement agreement to be a valid contract and dismissed the case pursuant to the agreement. The trial court also awarded Defendants $83,340.22 in attorney fees, pursuant to the terms of the settlement agreement, for their efforts in enforcing the agreement. Plaintiff appealed.
In considering Plaintiff’s arguments on appeal, the 2/1 DCA concluded that the trial court had properly held a trial to determine if a valid settlement agreement existed between the parties, and had not abused its discretion by admitting the parties’ confidential settlement communications into evidence to determine whether a binding agreement existed. The 2/1 DCA then turned to Plaintiff’s argument that the trial court erred in awarding attorney fees to Defendants because the settlement agreement provided attorney fees for the enforcement of the agreement – not to establish whether there was a settlement agreement. It found the purpose of determining whether the settlement agreement was valid was to determine whether it could be enforced against Plaintiff, and that the immediate consequence of the trial was enforcement of the agreement and dismissal of the case – therefore no error. The trial court had properly awarded attorney fees to Defendants for enforcement of the settlement agreement.
A professor in California State University’s Department of Counselor Education received a report from one of his students that the then-Chair of the Department had sexually and racially harassed her. Professor was aware of such complaints regarding this then-Chair. The Professor assisted the student in bringing a formal complaint against the then-Chair under the University’s policies and procedures, and the investigator ultimately concluded that the then-Chair had sexually harassed the student. The then-Chair was allowed to remain chair of the Department for 4-5 months after conclusion of the investigation, and was later placed on paid leave.
During the following couple of months, the University initiated three investigations against Professor, including a complaint from the then-Chair that Professor had harmed him by “inspiring students to come forward to report sexual and racial harassment by [the then-Chair].” The two other investigations involved complaints from two other faculty members that Professor had failed to make breast-feeding accommodations and had made intimidating statements.
After exhausting administrative remedies, Professor filed this lawsuit – Laker v. Bd. of Trustees of the Cal. State Univ., Case No. H044836 (6th District, February 28, 2019) (published) – against University and a University official for defamation and retaliation. The defamation claim stemmed from the e-mail claiming that he “knew of sexual harassment and failed to report it,” and that University officials called him a “liar” when he said that other students had complained of sexual harassment by then-Chair. Defendants SLAPPed back, but the trial court denied their motion finding that they had not met their initial burden of showing that the defamation and retaliation causes of action “arise from protected activity.” Defendants appealed.
In an opinion authored by Justice Danner, the 6th District affirmed in part, and reversed in part. Defendants argued that the trial court erred in its conclusion – asserting that Professor’s defamation claim arose from the protected activity of statements made by University official and others during the investigation into then-Chair, and that Professor’s retaliation claim arose from protected activity of the investigation of the three complaints against Professor. Professor countered that the anti-SLAPP statute does not protect these activities because University acted illegally by conducting “sham” investigations, and that University’s pursuit of three investigations against him does not meet the test for claims arising from protected activity.
With regard to Professor’s defamation cause of action, the 6th District – under Civil Code section 47(b)(3) – concluded that Defendants met their initial burden of showing the statements/conduct underlying the allegation arose from protected activity because the they were made in “official proceedings,” were absolutely privileged and protected, and were therefore inadmissible. Because the evidence on which Professor relied to support his defamation cause of action were inadmissible, he could not demonstrate a probability of success on the merits of his defamation claim.
Turning to the retaliation claim, the 6th District determined the alleged retaliation arose from both protected and unprotected activity. First, it rejected Professor’s argument that the University’s activities were illegal and, therefore, not protected. In doing so, the 6th District cited Hansen v. California Dept. of Corrections and Rehabilitation (2008) 171 Cal.App.4th 1537, which observed that, “conduct that would otherwise be protected by the anti-SLAPP statute does not lose its coverage simply because it is alleged to have been unlawful. They then considered whether the actions underlying the retaliation claim – the three investigations – was protected activity. The 6th District looked to Area 51 Productions, Inc. v. City of Alameda (2018) 20 Cal.App.5th 581, which discussed the Supreme Court case of City of Montebello v. Vasquez (2016) 1 Cal.5th 409, and noted “[t]he Vasquez opinion draws a distinction between, on the one hand, claims seeking to impose liability against a governmental entity, and, on the other, claims seeking to impose liability for the expressive activity of officials through whom a government entity must act.” The resulting conclusion was that while the activity of the 3 investigations against Professor was protected activity as to the University official, it was not as to University.
Finally, the 6th District determined that Defendants were entitled to attorney’s fees and costs as prevailing parties on their anti-SLAPP motion under Code Civ. Proc. section 425.16(c)(1) – remanding the issue back to the trial court to determine the amount of attorney’s fees and costs incurred in successfully striking the defamation cause of action, and the retaliation cause of action as to the University official.
Attorney Father, Whose Wife Had Passed, Claimed He Entered Into A Strictly No Strings Attached Arrangement With College Student Mother In Exchange For Money. She Claims Otherwise.
A child with special needs, who suffers from cerebral palsy and chronic lung problems, is at the center of this He Said/She Said in Monterey County Dept. of Child Support Services v. P.H., Case No. H043351 (6th District, February 28, 2019) (unpublished). Petitioner Mother and Respondent Father had met online. Father claims they entered into an approximate 4-month long, no-strings-attached arrangement in exchange for his monthly payments to her of $600 per month. He claims Mother was responsible for, and confirmed she was taking, birth control, and that he was responsible for providing her with evidence that he did not have a sexually transmitted disease. She claims they had a 6-7 month long dating relationship, that she had made it clear she was looking for long-term commitment, and that he provided her $800-$900 per month to assist with her expenses. Father claims the arrangement ended over a dispute as to whether he was getting what he paid for. She claims the relationship ended and he stopped giving her money when she became pregnant.
Nonetheless, after the child was born, Mother petitioned the court to establish paternity, for child support, and attorney fees of $5,000. Father did not object to, and repeatedly failed to comply with, the trial court’s order for genetic testing. The court then made its own paternity finding, concluding him to be the father of the child, pursuant to Family Code section 7551 (based on Father’s refusal to participate in the court-ordered genetic testing).
With regard to child support, Father claimed he had been a stay-at-home dad while his now-deceased attorney wife worked full-time, had last received a paycheck in 1988, had since been a self-employed civil appellate attorney taking only the odd job here and there, and had only earned a gross average of $500 per month every year since 2008. Ultimately, the trial court determined it to be in the child’s best interest to consider Father’s earning capacity in lieu of actual income for determining child support. To that end, the court imputed $4,583 per month to Father based on employment ads and general salary amounts/evidence for new attorneys in the area that were presented at the hearing.
Finally, the trial court ordered Father to pay Mother $3,000 (in monthly installments of $1,000) of the $5,000 in attorney fees she had requested pursuant to Family Code sections 2030 (needs-based) and 271 (sanctions-based for misconduct), without designating any portion of the award to either section.
On appeal, Father challenged the Parentage Judgment – claiming the trial court did not consider the “rights of others” in determining parentage, and erred in considering only the child’s rights rather than his. The 6th District disagreed – viewing section 7551 as a discovery sanction, and concluding that the trial court correctly considered the “rights of others,” meaning the rights of those persons who are entitled to the “probative value of the blood test evidence,” not the rights of the party or “wrongdoer” who refuses to submit to the genetic test as ordered – that the rights of the child supported entry of the Parentage Judgment based on Father’s failure to undertake the court-ordered genetic testing. The 6th District also did not agree with Father’s argument that substantial evidence did not support the trial court’s determination that imputing income was in the child’s best interest, but agreed that substantial evidence did not support the amount of income imputed to Father. On that issue, the 6th District found the trial court had abused its discretion, and remanded back to the trial court for further proceedings.
As for the award of attorney’s fees, the 6th District affirmed the trial court’s order. Although they agreed with Father, that section 2030 does not apply to actions for determination of parentage, they determined that there are similar needs-based statutes found throughout the Family Code that do apply – citing section 7605 – with the principle that the best interests of the child governs. Further, they found substantial evidence that Father had notice that Mother would seek attorney fees based on the parties’ relative financial circumstances, and that substantial evidence concerning the parties’ circumstances also supported the award. Based on the 6th District's findings on the needs-based award, it did not address Father's arguments concerning section 271 for sanctions-based fees.
Failure To Specify To Whom Fees Were Paid Was Not Fatal Either.
In Juarez v. Law Firm of Higbee & Associates, Case No. G054016 (4th Dist., Div. 3 Feb. 28, 2019) (unpublished), former law firm won a summary judgment against a former client who sued for legal malpractice and breach of the engagement contract after law firm represented client in a marital dissolution action. Law firm then moved for fees based upon a provision in the engagement agreement, which read as follows: ““VENUE & COSTS. Disputes arising out of this transaction shall be adjudicated in Orange County Superior Court in the State of California. Losing party to pay attorney’s fees and court costs.” The lower court awarded law firm $32,645.50 in fees, prompting an appeal by the former client.
The Fourth District, Division 3 affirmed in an opinion authored by Justice Fybel.
Client argued that the failure to define “transaction” meant that the fee clause did not apply and that the failure to specify to whom fees paid made the clause hopelessly ambiguous. Because contracts are to be construed as a whole and in order to not render language surplusage in nature, the 4/3 DCA determined that it was contextually clear that the losing party would pay fees to the prevailing party and that “transaction” encompassed the contractually agreed-upon services rendered under the engagement letter when wording throughout was considered.
The case is Iancu v. NantKwest Inc., No. 18-801 (U.S., cert. granted 3/4/19). A divided Federal Circuit, en banc, found USPTO attorney expenses were not recoverable, as discussed in our prior July 27, 2018 post.
Plaintiff Was Unable To Demonstrate That Later Contract With Fees Provisions Was Applicable To Earlier Contract Under Which It Sued.
Applied General Agency, Inc. v. Chinese Community Health Plan, Case No. G055669 (4th Dist., Div. 3 February 27, 2019) (unpublished) involved a Plaintiff insurance agency and a Defendant/Cross-Complainant insurance provider who each sued each other for breach of contract claims arising out of two separate contracts between the parties – a single-page 2002 contract which did not provide for attorney’s fees, and a 13-page 2013 contract which allowed for recovery of attorney’s fees in certain circumstances.
Plaintiff sued for breach of contract under the 2002 contract for failure to pay commissions required under the contract. It prevailed at trial, with the jury awarding $265,168.00 of Plaintiff’s $1.3 million requested damages.
Defendant/Cross-Complainant sued under the 2013 contract asserting causes of action against Plaintiff and its broker for quasi-contract and breach of contract for accepting commission payments without first meeting certain commission payment prerequisites contained in the 2013 contract. On the claim for quasi-contract and restitution, the jury found in favor of Plaintiff and its broker. On the claim for breach of contract, the jury found against Plaintiff but in favor of Plaintiff’s broker. Although prevailing in its breach of contract claim against Plaintiff, Defendant/Cross-Complainant was awarded nothing by the jury.
Following trial, Plaintiff and its broker filed a motion for attorney fees of about $1.38 million. They relied on certain indemnification and arbitration provisions in the 2013 contract to support their request. Disagreeing with their position, the trial court denied their request – explaining that the indemnity provisions on which they relied applied only to third party claims, and that Plaintiff was not the prevailing party on the cross-complaint as the jury had found in favor of Defendant/Cross-Complainant even though awarding no damages.
On appeal, the 4/3 DCA disagreed with the trial court’s assessment of the indemnity provisions – finding them broadly worded enough to encompass the direct litigation between the parties. This finding, however, did not assist Plaintiff and its broker because the 4/3 DCA also found the indemnity provisions in the 2013 contract did not apply to the 2002 contract under which Plaintiff sued. The two contracts had been executed nearly 12 years apart, the 2013 contract covered topics not addressed in the 2002 contract, and the 2013 contract made no reference to the 2002 contract – meaning there was no clear and unequivocal reference that the parties meant for the 2002 contract to be incorporated into the 2013 contract. Therefore, no basis was provided for applying Civil Code section 1717 in this matter, or for reversing the trial court’s order.
In Advent Companies, Inc. v. SJC II/Fourth and Haven, LLC, Case No. G055609 (4th Dist., Div. 3 February 27, 2019) (unpublished), a general contractor Plaintiff and property owner/developer Defendant/Cross-Complainant entered into a written construction agreement for Plaintiff to build a 298-unit apartment complex in the city of Ontario. The contract contained an attorney fees provision for the prevailing party of any dispute arising out of the contract.
Although the project started out ahead of schedule by several months, it eventually began to experience significant delays – resulting in a dispute between the parties that led to this lawsuit – with each party suing for delay-related damages under the contract.
Pursuant to their written agreement, the parties tried their case before a referee at JAMS, which provides mediation, arbitration, and other alternative dispute resolution services. Following a five-day trial, the referee awarded Plaintiff $265,499.24 of the $370,000 it sought in damages (approximately 72%), and awarded Defendant/Cross-Complainant $18,500 of its requested $1,145,000 liquidated damages (only about 1.6%). The referee then found there to be no prevailing party – concluding that “neither party prevailed in the entirety of its claims and both Parties prevailed to some extent,” and denying award of attorney fees to either party – though amending the statement of decision to award Plaintiff its costs as the prevailing party, but still denying it attorney fees. The trial court entered the referee’s amended statement of decision, denying attorney fees to Plaintiff, as the judgment. Plaintiff appealed.
In a decision from our local appellate court, and authored by Justice Goethals, the 4/3 DCA reversed – citing its previous ruling in de la Cuesta v. Benham (2011) 193 Cal.App.4th 1287 [discussed in our March 30, 2011 post], and applying Silver Creek, LLC v. BlackRock Realty Advisors, Inc. (2009) 173 Cal.App.4th 1533 [discussed in our May 21, 2009 post], as well as the practical prevailing party test under Civil Code section 1717 as articulated in Hsu v. Abbara (1995) 9 Cal.4th 863 [our Leading Case No. 2] – and remanded for further proceedings to determine Plaintiff’s attorney fees as the prevailing party on its contract claims.
Section 2924.12 was enacted in 2012, and is commonly known as the Homeowner Bill of Rights. It was intended to address California’s foreclosure crisis and prohibit against “dual tracking” where a lender pursues foreclosure at the same time a borrower seeks a loan modification.
Here, Plaintiff Borrowers in Hardie v. Nationstar Mortgage LLC, Case No. F075858 (5th Dist., February 27, 2019) (published) brought an action under section 2924.12 and prevailed in obtaining a temporary restraining order enjoining a non-judicial foreclosure sale on residential property. A few days after filing their complaint, Borrowers filed an ex parte application for a TRO along with an accompanying memorandum of points and authorities that contained a request for attorney’s fees and costs of $3,500.00. In granting the TRO, the trial court stated that it believed the requested attorney’s fees and costs under Civ. Code section 2924.12 was premature – permitted only to a party who obtains a preliminary injunction, not a TRO. However, the form order submitted by Borrowers and signed by the court ordered Defendants to pay attorney’s fees in the amount of $3,500.00.
In a conflict between a trial court’s oral pronouncement and its written order, the written order is controlling (Brown, Winfield & Canzoneri, Inc. v. Superior Court (2010) 47 Cal.4th 1233). So, one of three Defendants in this matter appealed the order – arguing that section 2924.12 does not permit an award of attorney’s fees to a borrower who prevails in obtaining a TRO.
Not true, said the Fifth District – citing the reasoning provided in Monterossa v. Superior Court (2015) 237 Cal.App.4th 747 (discussed in our June 14, 2015 post). Section 2924.12 “permits a court to award attorney’s fees to a ‘prevailing borrower,’ and deems a borrower to have prevailed if the borrower ‘obtained injunctive relief or was awarded damages pursuant to this section.’” The Monterossa court concluded that the language and purpose of the statutory scheme demonstrate ‘the Legislature intended to authorize an award of attorney fees and costs when a preliminary injunction issues.’ The Fifth District further declared that a TRO is a form of injunctive relief – that the statute does not distinguish between temporary, preliminary, and permanent relief – and, therefore, entitles Borrowers in this matter to attorney’s fees.
However, the Fifth District did agree with Defendant – that the request for attorney’s fees was procedurally defective in that it was not brought in a properly noticed motion. On that basis, the Fifth District reversed and remanded for further proceedings – noting that the Borrowers may elect to bring a properly noticed motion.

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