Case Name: EXCELSIOR UNION HIGH SCHOOL DISTRICT OF LOS ANGELES COUNTY, Plaintiff and Appellant, v. MINIE MARGARET LAUTRUP et al., Defendants and Respondents
Court: Court of Appeal of the State of California
Jurisdiction: California
Decision Date: 1969-02-05
Citations: 269 Cal. App. 2d 434
Docket Number: Civ. No. 31717
Parties: EXCELSIOR UNION HIGH SCHOOL DISTRICT OF LOS ANGELES COUNTY, Plaintiff and Appellant, v. MINIE MARGARET LAUTRUP et al., Defendants and Respondents.
Judges: 
Reporter: California Appellate Reports, Second Series
Volume: 269
Pages: 434–460

Head Matter:
[Civ. No. 31717.
Second Dist., Div. Two.
Feb. 5, 1969.]
EXCELSIOR UNION HIGH SCHOOL DISTRICT OF LOS ANGELES COUNTY, Plaintiff and Appellant, v. MINIE MARGARET LAUTRUP et al., Defendants and Respondents.
Harold W. Kennedy and John D, Maharg, County Counsel, and Alfred Charles De Flon, Deputy County Counsel, for Plaintiff and Appellant.
Thomas G. Baggot and George E. Atkinson, Jr., for Defendants and Respondents.

Opinion:
HERNDON, J.
Excelsior Union High School District of Los Angeles County, the plaintiff in this eminent domain proceeding, appeals from the trial court's order awarding defendants and respondents a total of $77,265 for attorneys' fees following plaintiff's abandonment of the proceeding. The award was made pursuant to the provisions of section 1255a of the Code of Civil Procedure.
For the purpose of facilitating the reader's understanding of the relevance of the facts to be recited in our statement of the ease, we shall first set forth this brief summary of appellant's basic contentions, namely:
(1) That the trial court erroneously based its award in part either upon an implied finding that respondents' attorneys "caused the abandonment" of the proceeding or upon the provisions of contracts between respondents and their attorneys wherein respondents agreed to pay counsel not less than $100,000 in the event of abandonment.
(2) That in fixing the amount to be allowed respondents for the services of their attorneys, the trial court could not properly take into consideration any of the services of counsel which influenced appellant's governing board to abandon the proceeding.
(3) That the award made by the trial court was based in substantial part upon services involving "political representation," which services, notwithstanding their propriety and their value to respondents, are not properly compensable under the provisions of section 1255a.
For reasons we shall develop in the course of this opinion, we have concluded that none of these assignments of error is well taken and that the order should be affirmed.
On February 1, 1963, appellant filed its complaint seeking to acquire for use as a high school site approximately 27.7 acres of land owned by respondents and located at the southwest corner of Imperial Highway and Valley View Avenue in the City of La Mirada, California. The land constituted one of the last remaining large parcels of land in this rapidly developing area and respondents earnestly desired to retain it as they indicated by their vigorous and continued efforts to persuade the school district to abandon the project.
George E. Atkinson, Jr., was acting as attorney for Norman Lautrup, executor of the estate of Niels P. H. Lautrup, who had died shortly before the filing of this action. The estate owned a one-half interest in the property and Minnie Margaret Lautrup owned the remaining one-half interest. Although Mr. Atkinson notified appellant that he represented the owners, and received its permission to withhold filing answers to the complaint until notified so to do, he allowed appellant to negotiate directly with the owners for several months without his participation to the end that an amicable settlement might be achieved if possible.
When settlement negotiations failed he, in effect, '-'associated" Mr. Thomas G. Baggot to assist him in the defense of appellant's action. Minnie Lautrup executed an employment contract with Mr. Baggot on November 21, 1963, in which it was agreed that in accordance with a certain schedule, Mr. Baggot was to receive a contingent fee based upon a percentage of all sums received by Minnie Lautrup in excess of the amount offered her by appellant for her interest in the property. On the same date an identical contract was executed by Mr. Atkinson and Norman Lautrup, as executor. This latter contract was approved by the probate court. Each of these contracts contained the following provision:
"That in the event of an abandonment, either express or by operation of law, by the said School District of said action, the undersigned will pay to [attorney] a reasonable attorney's fee, not less than $50,000.00 for his services performed up to the time of abandonment and for any service performed with relationship to said abandonment, including, but not limited to the securing of said fee upon abandonment from said School District. ' '
Appellant offered the owners $864,000, or approximately $.72 per square foot, for their property. This figure apparently represented the opinion of value of one of appellant's appraisers who had used a valuation date substantially earlier than would have been used at the trial if the proceeding had not been abandoned. The owners' two appraisers opined that the property was worth $1,900,000 and $1,700,000, respectively, as of the correct valuation date. The property had been appraised in the probate proceeding by the inheritance tax appraiser at $1,363,700 although he had used an even earlier valuation date than had appellant's appraisers.
Appellant's complaint also sought to condemn another smaller parcel of allegedly less valuable property owned by persons other than respondents. Appellant purchased this property during the pendency óf this proceeding for $170;000, or approximately $1.28 per square foot. In addition, on January 29, 1964, respondents allegedly received a bona fide offer of $1,900,000 for the property contingent upon the condemnation action being abandoned. This offer was rejected.
• We need not, and do not, speculate as to the amount the trier of fact might have awarded respondents as compensation for the subject property if the action had been tried. The foregoing recital, however, sufficiently indicates the extent and value of the subject matter of the litigation and its importance to the parties.
The pleadings filed herein were of a terse and standard variety but as in any case, and particularly in a condemnation action, these formal records usually reflect only a very small portion of the attorney's work product in the proceeding. Initially, the only matters in issue were the date of value, the fair market value of the property, and the question of severance damages, if any. However, on August 3, 1964, the initial -pretrial conference order was amended, and amended answers were filed, to eliminate the issue concerning severance damages and to present another issue, namely, whether or not the property was, in fact, being taken for a public use.
While the instant action was pending, on or about October 6, 1964, an election was held by the electors of appellant Excelsior Union High School District upon propositions presenting the question whether or not the whole territory of the district should be formed into two unified school districts. These proposals ultimately were adopted and on June 30, 1965, appellant ceased to exist as a legal entity. We need not consider the question whether or not the newly created unified district in which the subject property was located might have continued the action for the reason that its governing board unanimously resolved on February 18,1965, "that the County Counsel's Office be requested to drop the present condemnation suit pending on the Lautrup property and to negotiate with the property owners on a settlement of the suit. ' '
On April 30, 1965, the appellant's governing board also unanimously resolved to "authorize the County Counsel's office to proceed to abandon condemnation action on Lautrup Dairy site and proceed with necessary steps to pay abandonment costs." As respondents' attorneys pointed out to the trial court, the members of the board who moved and seconded this resolution were the two members thereof whose depositions had been taken by respondents in preparation for trial on the issue of public use.
On December 28, 1965, respondents' motion for judgment of dismissal was granted and a judgment was entered with the amounts to be allowed for costs and disbursements to be later determined and inserted. In addition to their direct court costs, respondents sought recovery of the sums expended for appraisal fees and $50,000 each for the fees of their respective attorneys. Following an extended hearing and the receipt of evidence both oral and documentary, the trial court on July 18, 1966, entered the order from which the present appeal is taken.
We now return to appellant's first assignment of error which it has stated as follows: ' ' The trial court in part based its award of attorneys' fees of $77,265.00. [the sum of $39,540 to Mr. Atkinson and $37,725 to Mr. Baggot] upon one or both of two improper factors: (1) upon the implicit findings that the efforts of one or both of defendants' attorneys were responsible for causing the abandonment; and (2) the contracts between the attorneys and their clients, each of which provided for attorney fees of not less than $50,000 in case of abandonment regardless of the value of the attorney services rendered. ' '
We find and hold that there is nothing whatever in the record to support the assumption that the trial court based its award upon either of these factors, except only that in a discussion with counsel the court expressed the thought that in evaluating legal services the result accomplished should be regarded as a relevant consideration.
Respondents ' employment contracts with their counsel were introduced into evidence without any objection. The trial court, and both of counsel for respondents, repeatedly emphasized and reemphasized their agreement with the observation of counsel for appellant that these contracts were not binding upon the court. Apparently they were offered and received solely for the purpose of indicating the importance which the parties attached to the services of their counsel and their view of the potential value of such services upon the happening of certain contingencies. There is nothing to indicate that the court gave any weight to them in fixing the award. The indisputable fact that the trial court awarded over $10,000 less to each attorney by way of fees than his client was obligated to pay therefor demonstrates that no improper reliance was placed on these contracts which, as we have said, were received in evidence without objection.
Appellant devotes a major portion of its brief to quotations from the testimony and from the arguments of respondents' counsel for the purpose of convincing this court that they were given credit for "causing the abandonment" by their "political" efforts designed to develop public sentiment in opposition to the project and to promote the creation of the new unified districts and the election of officials favoring abandonment.
The first and most salient observation that should be made on this point is that the entirety of this "evidence" was received without objection by appellant. As a matter of fact, this "issue" was developed very largely by appellant's cross-examination of respondents' witnesses in an apparent attempt to convince the trial court that the efforts of their counsel had been of little or no value and that they should not be rewarded by reason of the fact that fortuitous political changes had "frustrated" the purpose of the proceeding.
At no point during the hearing presently under review did counsel for appellant so much as hint that they regarded as improper any conduct on the part of respondents' counsel or that they were contending that appellant's decision to abandon the instant action was involuntary in any sense. On the contrary, counsel for appellant sought to prove that its decision to abandon the project was entirely voluntary and that the efforts of respondents' counsel, designed to establish that the property was not being taken in good faith for a permissible public use, and that it had grossly underestimated the costs of its project, had been without any effect upon it whatsoever.
In essence, it was appellant's contention in the trial court that in fixing the award, no credit should be given for the 1 ' results ' ' of the efforts of respondents ' counsel because those efforts were not effective causative factors in bringing about the abandonment.
It was to this issue that the trial judge directed his comment quoted out of context in the dissenting opinion herein. This comment is not "the statement of the court itself that it considered such services [political representation] an important factor in the case. ' ' On the contrary, it is manifest from the quotation itself that this comment of the trial judge constitutes no indication of his intention to award compensation for any services which might he classified as "political representation.It amounts to no more than a correct observation that the contribution of counsel to the result achieved was "an important factor." Counsel for respondents quite properly responded by expressing their concurring view, contrary to appellant's contention in the court below, that the result achieved was indeed an important factor and one that "gets us into the labyrinth of cause and effect. ' '
It should be emphasized that the trial court was not called upon to make any express declaration or any definitive finding to indicate what part of counsel's services were to be treated as political and noncompensable because, as we have indicated, appellant never raised this issue in the trial court. There is no finding of fact, either express or implied, indicating that any weight was given to "political" activities, as such. If there were we could properly reach this question now urged by appellant for the first time on appeal. If respondents had sought to introduce evidence of their "political" activities ; if appellant had objected thereto; and if such an objection had been overruled, we would have occasion to consider this issue. However, appellant itself developed the evidence (quoted at length in the dissenting opinion) in an effort to show that respondents ' counsel should not be given any credit for the "result" achieved in this action, that is to say, for convincing appellant's governing board that the proceeding should be abandoned.
Obviously appellant cannot now be heard to say that the trial court erred in receiving evidence which appellant itself elicited and introduced. Having created and developed this issue, appellant is in no position now to reverse its theory and contend that counsel were entitled to no compensation for services which influenced its decision to abandon the project. (Glendale Unified School Dist. v. Vista del Rossmoyne Co., 232 Cal.App.2d 493, 496-497 [42 Cal.Rptr. 899]; 3 Cal.Jur.2d, Appeal and Error § 140, 142, pp. 604, 607.)
In both Port San Luis Harbor Dist. v. Port of San Luis Transp. Co., 213 Cal.App.2d 689 [29 Cal.Rptr. 136], and State of California v. Westover Co., 140 Cal.App.2d 447 [295 P.2d 96], awards of attorneys' fees in the amounts of $125,000 and $150,000, respectively, were affirmed on appeal although it was clear that the decisions of the condemning bodies to abandon the projects in those eases were in large measure due to the fact that the sums awarded for the properties by the triers of fact greatly exceeded the expectations of the condemning agencies. To the extent that the efforts of a defendant's counsel may "cause" an abandonment either before or after trial by marshaling and displaying to the condemning agency evidence tending to prove that the property is not being taken for a public use or that the condemning body's cost estimates are unrealistic, such successes may properly be considered in determining the value of his services.
On the other hand, as stated in La Mesa-Spring Valley School Dist. v. Otsuka, 57 Cal.2d 309, 312, 318 [19 Cal.Rptr. 479, 369 P.2d 7], "The right to an award of costs is . . . purely statutory. [Citations.] Code of Civil Procedure section-1255a authorizes, upon the plaintiff's abandonment of an eminent domain proceeding, the recovery of 'costs and disbursements, which shall include all necessary expenses incurred in preparing for trial and during trial and reasonable attorney fees.' " (Italics added.) (P. 312)
' ' Of course, the defendant cannot recover any fees of Ms attorney incurred in connection with the proposed taking of his property unless such fees were incurred in preparation for the defense of the action. It is only those services rendered in preparation for the trial of the proposed action that are recoverable. It is for the trial court to determine what services were rendered in preparation for trial and the reasonable value of such services." (Italics added.) (P. 318)
It is inevitable that the boundary between compensable and noneompensable services may not always be susceptible of precise delineation, Nevertheless, the drawing of such line is within the province of the trial court, and there being nothing in the present record to justify a conclusion that it was improperly drawn, error should not be presumed. Contentions identical to those of appellant in this case were urged and rejected in Port San Luis Harbor Dist. v. Port of San Luis Transp Co., supra, 213 Cal.App.2d at p. 695, in the following apposite language:
"It would seem that some of the other matters referred to [in counsel for defendant's summary of his services], such as a conference with the foreman of the grand jury and conferences regarding proposed new legislation on the subject of condemnation, were not services in preparation for trial. If the judge regarded some of such matters as not being services in preparation for the trial, it might well be that he found that those services were not a substantial portion of the services rendered but were comparatively inconsequential and negligible in value and should be ignored in determining the reasonable value of legal services. It cannot properly be concluded that the court awarded attorneys' fees for services which were not rendered in preparation for the trial. The court did not abuse its discretion in awarding $125,000 as attorneys' fees. " (Italics added.)
It may also be noted that in Port San Luis Harbor Dist. v. Port of San Luis Transp. Co., supra, 213 Cal.App.2d 689, the trial court awarded defendant therein the full $125,000 requested and therefore it was necessary for the appellate court to conclude that any noncompensable items of work included in the claimant's recital of the services for which compensation was claimed were of '1 inconsequential and negligible value." In the instant case, however, the trial court reduced the requested allowance of $100,000 to $77,265, thereby providing further reason for this court to reject the unwarranted assumption that it awarded compensation for any items of service alluded to during the trial of this issue that are not entitled to consideration.
As observed in Decoto School Dist. v. M. & S. Tile Co., 225 Cal.App.2d 310, 314-315, 316 [37 Cal.Rptr. 225]: "In our opinion, the letter and spirit of section 1255a is to make the defendant whole for the reasonable attorney fees incurred by him in connection with the defense of an eminent domain action which the condemner has voluntarily abandoned. [Citations.] " (Pages 314-315)
"Moreover, while we would not depart from the philosophy that a landowner ought to be made whole where eminent domain proceedings are abandoned pursuant to section 1255a, we do not subscribe to the concept that he necessarily should be made whole according to his notions thereof or to the extent claimed by him." (Page 316.)
Having rejected appellant's specific assignment of error, we now turn to a consideration of the contention that the award is excessive as a matter of law. Since this contention necessarily is equivalent to an assertion that the evidence is insufficient to support the trial court's finding that the services being evaluated were reasonably worth the amount awarded, appellant's complete failure to set forth in its brief a fair statement of the evidence in the record relevant to this issue constitutes a violation of a fundamental rule of appellate practice and procedure. (Davis v. Lucas, 180 Cal.App.2d 407, 409-410 [4 Cal.Rptr. 479].)
Nevertheless, to demonstrate the sufficiency of the evidence to support the award under review we shall summarize some of the evidence bearing upon relevant considerations such as "the amount involved [in the litigation], the skill required in its handling, the skill employed, the attention given, . . . the attorney's skill and learning, including his age and experience in the particular type of work demanded." (La Mesa-Spring Valley School Dist. v. Otsuka, supra, 57 Cal.2d 309, 316.)
As a result of their extensive investigations into the subject matter, the owners' attorneys had concluded that in the instant case it would be possible to prove that the condemning body did not intend in good faith to take the property for a true public use. (Cal. Const., art. I, § 14; People v. Chevalier, 52 Cal.2d 299 [340 P.2d 598].) They expected to establish this fact, despite the conclusive nature of the condemning body's resolution as to necessity (Code Civ. Proc., § 1241, subd. (2)), by proof (1) that there was neither a present nor future need for a school to be located upon the proposed site; (2) that it was impossible for the school to be financed or built within the next seven years; and (3) that the highly unsuitable location of the proposed site for school purposes, contrasting with its peculiar suitability and its greater value for commercial purposes, made it manifest that the condemning body had no bona fide intention to use the property for the purpose asserted but rather intended to hold it indefinitely until its appreciated value would permit it to be sold to private persons at great profit.
In other words, it was the purpose of the owners to establish a factual foundation to support their contention that although property may be acquired for future educational needs (cf. Ed. Code, § 19577), this does not permit the acquisition of property by condemnation for purposes of speculation as a means of raising funds which thereafter may be used to purchase other property truly suitable for school purposes.
We need not undertake to evaluate the defense interposed by the allegations of the amended answers. (Cf. Anaheim Union High School Dist. v. Vieira, 241 Cal.App.2d 169 [51 Cal.Rptr. 94]. Petition for hearing denied.) It is sufficient for present purposes to observe that they presented substantial issues of law and fact. In many important respects, the instant case is similar to that presented to the court in Port San Luis Harbor Dist. v. Port of San Luis Transp. Co., supra, 213 Cal.App.2d 689, 693, in which the owners lost on the issue of public use, but, nevertheless it was held that the services of their counsel devoted to this issue were properly considered in determining the amount of the attorneys' fees to be awarded.
We, of course, do not question the asserted proposition that "It is certainly not debatable in the courts that the operation of a high school is for a public purpose. ' ' However, neither is it debatable that if a school board takes land under the guise of constructing a public school thereon but with the true intention of selling it thereafter to private parties for a profit, such a taking is not for a public use.
As pointed out in People v. Chevalier, supra, 52 Cal.2d 299, 304 et seq., it is only after it is established that the taking is for a public use that the conclusive presumption regarding necessity and public good is applicable. The court in Chevalier was at pains to point out at page 304: "There is no question, then, that the takings in the instant case are for a public use. Defendants did not allege fraud, bad faith, or abuse of discretion in the sense that the condemner does not actually intend to use the property as it resolved to use it." This is exactly the contention upon which respondents based their defense in the instant case!
Since the available evidence relating to this issue is not in the record before us, we have no basis upon which to evaluate the defense grounded upon the allegation that appellant's taking of the property was for purposes of land speculation rather than for the construction of a school. But it is scarcely open to question that respondents were entitled to an adjudication of the issues tendered by this defense and if they had prevailed thereon they would have won the lawsuit. Therefore, even if the court below accepted the opinion of the one expert who testified on appellant's behalf that respondents probably would not have prevailed in a trial, it still would not follow that the services of counsel in researching the law and discovering the evidence bearing upon those issues were noncompensable because they were "not incurred in preparation for trial. ' '
In addition to the issue of public use, counsel for the respondent owners spent considerable time preparing for the scheduled trial on the question of value. They were successful in having the valuation date set more than a year after the date of service of summons, a not insignificant gain since it was conceded that the subject property was located in an area of rapidly rising property values. In addition, to the extent that their pretrial preparations produced evidence causing other community leaders interested in the proceeding to conclude that the condemning body's estimated costs of acquisition would prove grossly unrealistic, their endeavors may have contributed to the decision to abandon the proceeding, and this not merely to the advantage or respondents, but presumably to the advantage of the taxpayers of the school district.
The attorneys estimated their total time expenditures at 45 and 47 days, respectively, without any indication that this included any "political" or "lobbying" activities. The criticism directed to the time records kept by respondents ' counsel appears to be unwarranted. As they reasonably explained, since their contracts with their clients provided for contingent fees, they had no reason to be concerned with such exact time records as would have been required if they had been operating on a time-price basis as did the office by whom appellant's sole expert witness was employed. In addition, at the rate of $50 per hour, the figure set by appellant's expert, the award was substantially justified on a time basis alone.
Appellant's expert testified that he would have charged respondents only $7,500 or $10,000 to handle the ease to the date of dismissal because he would not have "wasted his time" in preparing to litigate the issue of public use or in seeking to demonstrate to the condemning body the error of its decision to condemn. If respondents' counsel had followed this course, it is quite possible either that their clients would have lost their land or that the proceeding would have been abandoned only after an extended trial had established the value of the land at a figure so high that the project could not reasonably have been carried to completion.
It is beyond serious question that the primary purpose of respondents was to defeat the action and thus to retain their property. In fact, on January 17, 1964, they had offered to waive all claims for costs and disbursements if the proceeding were to be then abandoned despite the fact they had contractually obligated themselves to pay their attorneys $100,000 upon the occurrence of such a contingency. In this regard it may be noted that respondents ' attorneys in striving to establish the wisdom of abandoning the action were working against their own financial interests. That is to say, if a trier of .the fact had fixed the fair market value of the property even at the lower figure earlier set by the inheritance tax appraiser, their contingent fee contracts would have entitled them to a fee in the approximate amount of $200,000.
"The determination of what is a reasonable fee is a question of fact that rests within the discretion of the trial court [citations], after it has considered a number of factors including ' [t]he nature of the litigation, its difficulty, the amount involved, the skill required in its handling, the skill employed, the attention given, the success or failure of the attorney's efforts, the attorney's skill and learning, including -his age and experience in the particular type of work demanded.' [Citation.]'' (La Mesa-Spring Valley School Dist. v. Otsuka, supra, 57 Cal.2d 309, 316.)
It is implicit in appellant's basic contention, of course, that the trial court manifestly abused its discretion in evaluating the services of respondents' counsel. This contention is the basic foundation upon which appellant's entire case is necessarily constructed because, as we have shown, there is no finding of fact, no ruling on an objection to evidence, nor any other affirmative action of the trial court indicating that it relied on any improper consideration in reaching its decision.
On this subject of abuse of discretion, it is aptly stated in Berry v. Chaplin, 74 Cal.App.2d 669, 672 [169 P.2d 453] : "In a legal sense discretion is abused whenever in the exercise of its discretion the court exceeds the hounds of reason, all of the circumstances before it being considered.'' (Italics added.)
In the instant case, it cannot fairly be said that the award "exceeds the bounds of reason." Inasmuch as the award made by the trial court is substantially less than the valuations indicated by the several expert witnesses ($100,000 to $120,000) who testified on behalf of respondents, it certainly cannot be asserted that the award is not supported by the evidence. The statement made by the court in Stuart v. Preston, 2 Cal.App.2d 310, 318 [38 P.2d 155, 39 P.2d 441], in connection with a similar problem is equally apposite here:
"There is no showing here that this verdict was the result of passion or prejudice. It is supported by the sworn testimony of reputable members of the bar. To hold that it is excessive (or so grossly excessive as to shock our consciences) we would have to find that all these witnesses swore falsely and that the trial judge refused to perform his duty. . . ."
In addition, of course, the trial judge is himself an expert in the matter of attorney fees. " '. . . "The value of attorney's services is a matter with which a judge must necessarily be familiar. When the court is informed of the extent and nature of such services, its own experience furnishes it with every element necessary to fix their value." [Citations.]' " (Italics added.) (California Interstate Tel. Co. v. Prescott, 228 Cal.App.2d 408, 411 [39 Cal.Rptr. 472].)
As aptly stated in State of California v. Westover Co., supra, 140 Cal.App.2d 447, 450: " [T]he appeal is not a trial de novo of the basic issue of reasonableness of the fee allowed. What constitutes a reasonable fee is and ought to be confided in the first instance to the trier of fact, the court called upon to make the allowance, and it matters not whether an appellate court sitting in review of the trial court's order finds itself in agreement with or differing from the amount so fixed. We can inquire only as to whether or not the sum allowed is so exorbitant that its allowance constitutes a palpable and plain abuse of discretion. ' '
The order is affirmed.
Roth, P. J., concurred.
It is to tie noted, however, that appellant's expert (Mr. Hadley) indicated his recognition that services rendered in procuring an abandonment are compensable under the statute. He testified: "Q. And did you take into consideration the success of obtaining an abandonment in this case in arriving at your fee? A. I took into consideration the legal contribution made in relation to the abandonment, yes. ' '