Court Opinion

ID: 9840455
Source: CourtListenerOpinion
Date Created: 2023-09-18 17:04:45.473165+00
Date Added: 2024-06-11T10:46:30.871656
License: Public Domain

Filed 9/18/23 Perera v. Moine CA2/7
   NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                         SECOND APPELLATE DISTRICT

                                      DIVISION SEVEN

 LIONEL PERERA et al., as                                            B319315
 Trustees, etc.,
                                                                     (Los Angeles County
           Plaintiffs, Cross-defendants                              Super. Ct. No.
           and Appellants,                                           19STCV12537)

           v.

 CHARLES A. MOINE,

           Defendant, Cross-complainant
           and Appellant.

      APPEALS from a postjudgment order of the Superior Court
of Los Angeles County, Terry Green, Judge. Vacated and
remanded with directions.
      Law Offices of Jeffrey B. Ellis and Jeffrey B. Ellis for
Plaintiffs, Cross-defendants and Appellants.
      Robert D. Feighner; Hitchcock Bowman & Schachter and
Robert B. Schachter for Defendant, Cross-complainant and
Appellant.
       After entering a judgment finding in favor of Lionel and
Nirmala Perera as Trustees of the Perera Family Trust on their
breach of contract action against Charles A. Moine and in favor of
Moine and against the Pereras on Moine’s cross-complaint, the
trial court awarded the Pereras attorney fees as the prevailing
parties in the lawsuit. Moine appealed the postjudgment order,
contending the trial court erred in determining the Pereras were
entitled to attorney fees as the prevailing parties. The Pereras
cross-appealed, contending the trial court abused its discretion by
awarding them only 50 percent of the fees requested.
       In Perera v. Moine (Sept. 18, 2023, B317395) [nonpub. opn.]
(Perera I), filed concurrently with this opinion, we reversed the
judgment after holding the trial court had erred in concluding the
Pereras’ contract recovery must be reduced because of their
breach of the implied covenant of good faith and fair dealing and
further offset by Moine’s recovery on his cross-complaint. We
remanded the cause for the trial court to enter a new judgment
that did not reflect those reductions in the amount awarded the
Pereras and that found in favor of the Pereras on Moine’s cross-
complaint. In light of our reversal of the judgment, we vacate the
postjudgment order and remand for the trial court to redetermine
the amount of attorney fees to which the Pereras are entitled as
the prevailing parties.
      FACTUAL AND PROCEDURAL BACKGROUND
      As we explained in Perera I, supra, B317395, on
October 26, 2021 the trial court entered judgment in favor of the
Pereras in their breach of contract action against Moine and in
favor of Moine on his cross-complaint. The court awarded the
Pereras damages of $750,700.16, rejecting the Pereras’ proposed
figure of $4.1 million based on their expert’s opinion, adopting

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instead Moine’s estimate of $911,000 based on his consultant’s
calculations; adding $209,448 for certain payments by the
Pereras; and then reducing the approximately $1.12 million
subtotal by one-third based on its finding the Pereras had
breached the implied covenant of good faith and fair dealing
affecting one portion of their contract claim. The court
additionally awarded Moine $61,000 on his cross-complaint,
which it identified as an offset to the Pereras’ damage award.
       The judgment prepared by the court on Judicial Council
form JUD-100, in addition to awarding the Pereras damages,
checked boxes awarding them prejudgment interest, attorney
fees and costs. The lines for the amounts to be included in the
judgment for those items were left blank.
       The Pereras and Moine made a variety of postjudgment
filings, including competing motions to tax costs, for hearing in
December 2021. For their part, the Pereras requested their
attorney fees as the prevailing parties pursuant to Code of Civil
Procedure section 10321 and Civil Code section 1717,2 relying on

1     Code of Civil Procedure section 1032, subdivision (b),
provides, “Except as otherwise expressly provided by statute, a
prevailing party is entitled as a matter of right to recover costs in
any action or proceeding.” Except when “the context clearly
requires otherwise,” the term “prevailing party” for purposes of
section 1032 includes “the party with a net monetary recovery.”
(§ 1032, subd. (a)(4).) Items allowable as costs under section 1032
include attorney fees when authorized by contract, statute or law.
(§ 1033.5, subd. (a)(10).)
2      Civil Code section 1717, subdivision (a), provides in part,
“In any action on a contract, where the contract specifically
provides that attorney’s fees and costs, which are incurred to

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the attorney fee provision in the purchase agreement on which
their breach of contract action was based.3 Moine contended in
his filings that the court had prematurely determined the
Pereras were the prevailing parties and the court should either
find he was the prevailing party or there was no prevailing party
in the litigation. Moine also separately sought, for hearing in
January 2022, attorney fees based on the favorable ruling on his
cross-complaint, relying on both the purchase agreement and the

enforce that contract, shall be awarded either to one of the
parties or to the prevailing party, then the party who is
determined to be the party prevailing on the contract . . . shall be
entitled to reasonable attorney’s fees in addition to other costs.”
Subdivision (b) generally provides in part, “[T]he party prevailing
on the contract shall be the party who recovered a greater relief
in the action on the contract. The court may also determine that
there is no party prevailing on the contract for purposes of this
section.”
3      Paragraph 16 of the purchase agreement provided, “If any
Party . . . brings an action or proceeding . . . involving the
Property whether founded in tort, contract or equity, or to declare
rights hereunder, the Prevailing Party (as hereafter defined) in
any such proceeding, action, or appeal thereon, shall be entitled
to reasonable attorneys’ fees. . . . The term ‘Prevailing Party’
shall include, without limitation, a Party . . . who substantially
obtains or defeats the relief sought, as the case may be, whether
by compromise, settlement, judgment, or the abandonment by the
other Party . . . of its claim or defense. The attorneys’ fees award
shall not be computed in accordance with any court fee schedule,
but shall be such as to fully reimburse all attorneys’ fees
reasonably incurred.”

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separate, but related holdback agreement at issue in the
underlying litigation.4
       On December 15, 2021, after hearing argument on the
various postjudgment matters before it, the trial court reaffirmed
its prior determination the Pereras were the prevailing parties
and entitled to attorney fees but also ruled they had provided
insufficient information to support their request. (They had
provided a declaration from trial counsel but not billing records.)
The court also granted the Pereras’ motion to tax costs and
denied Moine’s motion, concluding the Pereras, not Moine, were
entitled to recover costs in the litigation.
       In supplemental briefing the Pereras submitted their
counsel’s declaration that the Pereras had incurred a total of
$788,072 in attorney fees for 1,571.1 hours billed. The
declaration attached invoices with detailed billing entries. Moine
filed an opposition.
       Following argument on January 19, 2022, the trial court on
February 25, 2022 entered its order awarding the Pereras
$388,541 in attorney fees. The court explained it accepted as
“eminently reasonable” counsel’s hourly billing rates but found
the claim for more than 1,500 billable hours for a case with a one-
week bench trial “somewhat shocking.” The court provided

4     The holdback agreement provided, “If a dispute develops
between the Parties or any other claims of liability, cost or
expense arise in connection with this Agreement, and if
arbitration, legal action or settlement negotiations are necessary
for the interpretation or enforcement of the Agreement, or of any
rights or obligations flowing herefrom, the prevailing party (or
parties) shall recover its actual costs and actual attorneys’ fees
incurred in connection with any such dispute or claim.”

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several instances of unreasonable time charges, which it
described as having been “selected at random,”5 and wrote its
overall review of the bills confirmed the unreasonableness of the
Pereras’ request. Citing Morris v. Hyundai Motor America (2019)
41 Cal.App.5th 24, in which this court upheld the trial court’s
decision to cut entirely the hours billed by six attorneys as a
permissible way to reduce an inflated fee request reflecting that
too many attorneys had worked on the case, the trial court here
concluded an “across-the[-]board reduction of 50% results in an
award of 778.55 hours, which is a much more appropriate amount
of time to spend on a case like this.”6

5     As one example, the court pointed out that in August 2019,
when the case was at issue and discovery was proceeding, the
Pereras’ counsel was still researching the elements of the
Pereras’ causes of action. The court noted, “This might be
understandable if Plaintiffs were bringing complex statutory
claims. But the causes of action at issue here were breach of
contract and fraud—it doesn’t get much more basic than that.”
A second example involved researching the burden of proof. The
court then observed, “It is simply hard to imagine that a
reasonable client would pay for an attorney to research what they
should already know (the elements of a breach of contract claim,
or the burden of proof in a civil case).”
6      As discussed, the Pereras sought recovery based on 1,571.1
billed hours. The trial court stated that total included 14.1 hours
of work by unidentified “litigation professionals” for whom
insufficient information had been provided. The court excluded
those hours before halving the remaining total.

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                          DISCUSSION
      1. Moine’s Appeal
      Appealing the February 25, 2022 attorney fee order, Moine
argues the trial court abused its discretion in determining the
Pereras were the prevailing parties in the litigation. (See
Mountain Air Enterprises, LLC v. Sundowner Towers, LLC (2017)
3 Cal.5th 744, 751 [the propriety or amount of attorney fees to be
awarded is generally a discretionary decision for the trial court
reviewed only for an abuse of that discretion]; PLCM Group v.
Drexler (2000) 22 Cal.4th 1084, 1095 [“‘[t]he “experienced trial
judge is the best judge of the value of professional services
rendered in his court, and while his judgment is of course subject
to review, it will not be disturbed unless the appellate court is
convinced that it is clearly wrong”’—meaning that it abused its
discretion”].) If the underlying judgment and the award of
damages to the Pereras were reversed in Perera I, supra,
B317395, Moine explains, he would necessarily be the prevailing
party because he would not only have recovered on his cross-
complaint but also successfully defended against the Pereras’
action. In any event, he argues, even if we affirmed the judgment
as entered by the trial court, he obtained the entire amount he
sought on his cross-complaint while the court awarded the
Pereras only $750,700.16 of the more than $4 million they sought
for Moine’s breach of contract. As such, he should have been
determined to be the prevailing party or, at very least, neither
side should have been awarded attorney fees.
      Moine’s arguments for finding the trial court abused its
discretion in identifying the Pereras as the prevailing parties fail.
In Perera I, supra, B317395 we neither reversed the damage
award in favor of the Pereras (Moine’s first scenario) nor affirmed

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the judgment as entered by the trial court (Moine’s second
scenario). Instead, we reversed the finding in favor of Moine on
his cross-complaint (and with it the related offset to the Pereras’
damage award) and directed the trial court on remand to increase
the Pereras’ recovery by more than $300,000. The trial court’s
original prevailing party finding appeared to be well within its
discretion. As the judgment will be modified, the extent to which
the Pereras prevailed in this litigation is even greater.
      2. The Pereras’ Cross-appeal
       In their cross-appeal the Pereras contend the trial court
abused its discretion in reducing the fees they requested by
50 percent, arguing each of the specific examples identified by the
court involved the appropriate use of attorney time.
Characterizing the case at bar as complex,7 they assert the
court’s comparison of the total hours expended to its recollection
of the time spent in other cases it had tried fell far short of
justifying the large, across-the-board reduction it made. They

7      Although Judge Terry Green, who presided at trial, labeled
the case in his fee award order “a relatively straightforward
breach of contract case,” he, several months earlier when ruling
on objections to his statement of decision, described it as “an
interesting case” that “raise[d] some really interesting issues, and
frankly, at least to me, of first impression.” And at the hearing
on the fee motion, he referred to it as “a difficult case, very well-
tried,” which contained “very interesting appellate issues.”
      Judge Green recently retired from the bench. It will be up
to the judge assigned to hear the case on remand to make an
independent evaluation of the relative complexity of case issues
when determining the reasonable attorney fees to which the
Pereras are entitled.

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urge us to either increase the fee award or remand for the trial
court to conduct a proper fee determination.
      The trial court was not required to issue a statement of
decision with regard to its fee award (and the Pereras did not
request one). (See Ketchum v. Moses (2001) 24 Cal.4th 1122,
1140; Taylor v. Nabors Drilling USA, LP (2014) 222 Cal.App.4th
1228, 1250-1251; see also California Common Cause v. Duffy
(1987) 200 Cal.App.3d 730, 754-755 [“the trial court has no
sua sponte duty to make specific factual findings explaining its
calculation of the fee award”].) Because it was not obligated to
articulate all the findings on which its award was based, the
court, in reaching its decision reducing the Pereras’ requested
fees based on the then-existing judgment, may have properly
considered its findings that the Pereras were only partially
successful on their contract claim because they had breached the
implied covenant of good faith and fair dealing and were
unsuccessful in defending against Moine’s cross-complaint.8 (See,

8     Having at the time only succeeded on their action for
breach of the purchase agreement and not in defending against
Moine’s cross-complaint for their breach of the holdback
agreement, the Pereras in both their fee motions relied solely on
the attorney fee provision of the purchase agreement. The
Pereras’ fee request nevertheless included fees for their counsel’s
work related to Moine’s cross-complaint, which the trial court
could have properly deducted under the judgment then in place.
      Nothing in either of our opinions preclude the Pereras from
seeking on remand a determination they were also the prevailing
parties in Moine’s cross-action and moving for attorney fees
under the fee provision of the holdback agreement. (See Hunt v.
Fahnestock (1990) 220 Cal.App.3d 628, 630 [“in a lawsuit
involving several contracts, attorney’s fees pursuant to Civil Code

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e.g., PLCM Group v. Drexler, supra, 22 Cal.4th, at p. 1096 [“‘[t]he
trial court makes its determination [of the value of legal services]
after consideration of a number of factors, including the 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, and other circumstances in the case’”].)
       As discussed, in Perera I, supra, B317395 we disagreed
with these determinations, reversed the judgment and remanded
the matter with directions that will result in a larger recovery for
the Pereras. On remand, the amount of reasonable attorney fees
recoverable by the Pereras as prevailing parties must also be
reassessed, with the parties having an opportunity to present
arguments on that issue to the trial court. (Cf. Apex LLC v.
Korusfood.com (2013) 222 Cal.App.4th 1010, 1015 [“[t]he effect of
a general reversal is to create a situation where no judgment is
deemed to have been entered”].) As a matter of best practice and
to facilitate any future appellate review, we encourage the trial
court on remand to provide a full explanation for any significant
departures from the lodestar9 it may make in awarding fees.

section 1717 may be awarded to the prevailing party on each
contract,” fn. omitted].)
9     See generally PLCM Group, Inc. v. Drexler, supra,
22 Cal.4th at page 1095 (“the fee setting inquiry in California
ordinarily begins with the ‘lodestar,’ i.e., the number of hours
reasonably expended multiplied by the reasonable hourly rate”).

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                         DISPOSITION
       The postjudgment order awarding $388,541 in attorney
fees to the Pereras as prevailing parties is vacated. The matter is
remanded for the trial court to reconsider, consistent with the
views expressed in this opinion and Perera I, supra, B317395, the
amount of attorney fees to award the Pereras.
       The Pereras are to recover their costs on appeal.

                                     PERLUSS, P. J.

      We concur:

            SEGAL, J.

            FEUER, J.

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